EXHIBIT 4.7
CONFORMED COPY
12 February 2004
US$100,000,000 SECURED BANK GUARANTEE FACILITY AGREEMENT
between
SEAWAY (UK) LIMITED
XXXXX OFFSHORE X.X.
XXXXX OFFSHORE SERVICES X.X.
XXXXX OFFSHORE AS
XXXXX OFFSHORE LIMITED
XXXXX OFFSHORE WEST AFRICA S.A.S.U.
SOTRAPLEX X.X.
XXXXX OFFSHORE B.V.
ETPM DEEPSEA LIMITED
and
XXXXX OFFSHORE INC.
as Indemnifiers
XXXXX OFFSHORE S.A.
and
The Parties Listed in Part A of Schedule 1 Hereto
as Guarantors
HSBC BANK PLC
as Arranger
CREDIT LYONNAIS
HSBC BANK PLC
and
DNB NOR BANK ASA (formerly DEN NORSKE BANK ASA)
as Issuing Banks
The Parties Listed in Part B of Schedule 1 Hereto
as Banks
HSBC BANK PLC
as Facility Agent and Security Trustee
WEIL, GOTSHAL & XXXXXX
One Xxxxx Xxxxx Xxxxxx XX0X 0XX
Tel: x00 (0) 00 0000 0000 Fax: x00 (0) 00 0000 0000
xxx.xxxx.xxx
TABLE OF CONTENTS
Page
1 DEFINITIONS AND INTERPRETATION............................................2
2 THE FACILITY.............................................................22
3 PURPOSE AND RESPONSIBILITY...............................................23
4 BANK GUARANTEES..........................................................23
5 REDUCTION................................................................28
6 CONDITIONS PRECEDENT AND SUBSEQUENT......................................28
7 REPRESENTATIONS AND WARRANTIES...........................................33
8 CURRENCY.................................................................37
9 FUNDING AND CASH COVER...................................................38
10 INTEREST.................................................................39
11 GUARANTEE AND INDEMNITY..................................................39
12 FEES.....................................................................43
13 FACILITY DOCUMENTS.......................................................44
14 AGENCY AND TRUST.........................................................46
15 COVENANTS................................................................53
16 EARNINGS.................................................................63
17 EVENTS OF DEFAULT........................................................63
18 SET-OFF AND LIEN.........................................................68
19 ASSIGNMENTS BY OBLIGORS..................................................69
20 ADDITIONAL INDEMNIFIERS..................................................69
21 ASSIGNMENTS AND TRANSFERS BY FINANCE PARTIES AND SUB-
PARTICIPATION............................................................70
22 PAYMENTS, MANDATORY PREPAYMENT, RESERVE REQUIREMENTS AND
ILLEGALITY...............................................................71
23 COMMUNICATIONS...........................................................74
24 GENERAL INDEMNITIES......................................................75
25 MISCELLANEOUS............................................................76
26 LAW AND JURISDICTION.....................................................80
SCHEDULE 1...................................................................82
PART A THE GUARANTORS........................................................82
PART B THE BANKS, THE COMMITMENTS AND THE PROPORTIONATE SHARES...............83
SCHEDULE 2 THE SENIOR SHIPOWNING GUARANTORS AND THE SENIOR VESSELS...........84
i
TABLE OF CONTENTS
(continued)
Page
SCHEDULE 3 THE JUNIOR SHIPOWNING GUARANTORS AND THE JUNIOR VESSELS...........85
SCHEDULE 4 FACILITY DOCUMENTS
PART A FIRST PRIORITY ACCOUNT PLEDGES AND SHARE PLEDGES......................89
PART B XXXX SHIP MORTGAGES, ASSIGNMENTS AND SHARE PLEDGES....................92
PART C XXXX SHIPOWNING GUARANTEES............................................96
PART D SNSA GUARANTEE AND SNTG SHIP COLLATERAL DOCUMENTS.....................97
SCHEDULE 5 FORM OF ISSUE REQUEST.............................................99
SCHEDULE 6 CERTIFICATE OF COMPLIANCE........................................101
SCHEDULE 7 FORM OF TRANSFER CERTIFICATE.....................................103
SCHEDULE 8 DISCLOSED PERMITTED DISPOSALS....................................106
SCHEDULE 9 MORTGAGED VESSELS CRITERIA.......................................107
SCHEDULE 10 TERMS OF BANK'S INDEMNITY TO ISSUING BANK.......................109
SCHEDULE 11 MATERIAL LITIGATION.............................................111
SCHEDULE 12 EXISTING ENCUMBRANCES...........................................113
SCHEDULE 13 CONSOLIDATED ACCOUNTS RECEIVABLE AGEING AND COLLECTION
STATUS AS AT [(] FOR XXXXX OFFSHORE S.A.........................114
SCHEDULE 14 OPERATIONAL COVENANTS...........................................115
SCHEDULE 15 THE BANKS UNDER THE EXISTING CREDIT AGREEMENTS..................126
SCHEDULE 16 FORMS OF LOSS PAYABLE CLAUSES...................................127
SCHEDULE 17 FORM OF NOTICE OF ASSIGNMENT OF INSURANCES......................128
SCHEDULE 18 FORM OF ACCESSION AGREEMENT.....................................129
SCHEDULE 19 APPROVED SHIPBROKERS LIST.......................................131
SCHEDULE 20 CASH MANAGEMENT SYSTEM..........................................132
SCHEDULE 21 BONDING FACILITIES..............................................135
SCHEDULE 22 INFORMATION PACKAGE.............................................143
SCHEDULE 23 EXISTING BILATERAL BONDING AGREEMENTS...........................144
SIGNATORIES.................................................................149
ii
GUARANTEE FACILITY AGREEMENT
Dated: 12 February 2004
BETWEEN:
(1) SEAWAY (UK) LIMITED, a company incorporated under the laws of England and
Wales, with its registered office at Dolphin House, Windmill Road, Sunbury
on Xxxxxx, Xxxxxxxxx XX00 0XX, XX and registered number 00974791 ("Seaway
UK");
(2) XXXXX OFFSHORE S.A., a company incorporated under the laws of France with
its registered office at 00, Xxxxxx Xxxxx Xxxxxxx, 00000 Xxxxxxxx, Xxxxxx
("SO France");
(3) XXXXX OFFSHORE SERVICES S.A., a company incorporated under the laws of
France with its registered office at 00, Xxxxxx Xxxxx Xxxxxxx, 00000
Xxxxxxxx, Xxxxxx ("SOS France");
(4) XXXXX OFFSHORE AS, a company incorporated under the laws of the Kingdom of
Norway with its registered office at Xxxxxx 0, 0000 Xxxxxxxxx, the Kingdom
of Norway ("SO Norway");
(5) XXXXX OFFSHORE LIMITED, a company incorporated under the laws of Scotland
with its registered office at Xxxxxxxxx Xxxxx, Xxxxx Xxxx, Xxxxxxxxx,
Xxxxxxxx, XX00 0XX, XX and with registered number SC128705 ("SO Scotland");
(6) XXXXX OFFSHORE WEST AFRICA S.A.S.U., a company incorporated under the laws
of France with its registered office at 00 Xxxxxx Xxxxx Xxxxxxx, 00000
Xxxxxxxx, Xxxxxx ("SO West Africa");
(7) SOTRAPLEX S.A., a company incorporated under the laws of France with its
registered office at 00 Xxxxxx Xxxxx Xxxxxxx, 00000 Xxxxxxxx, Xxxxxx
("Sotraplex");
(8) XXXXX OFFSHORE B.V., a company incorporated under the laws of The
Netherlands with its registered office at Xxxxx Xxxxxxxxxx 00, 0000 XX
Xxxxxxxx, Xxx Xxxxxxxxxxx ("SO BV");
(9) ETPM DEEPSEA LIMITED, a company incorporated under the laws of England and
Wales, with its registered office at Dolphin House, Windmill Road, Sunbury
on Xxxxxx, Xxxxxxxxx XX00 0XX, XX and registered number 01902584 ("ETPM");
(10) XXXXX OFFSHORE INC., a company incorporated under the laws of the State of
Louisiana, United States of America with its registered office at 000
Xxxxxxx Xxxxxxxxx, Xxxxx X, Xxxxxxxxx, Xxxxxxxxx 00000, Xxxxxx Xxxxxx of
America ("SO US", and together with Seaway UK, SO France, SOS France, SO
Norway, SO West Africa, SO Scotland, SO BV, Sotraplex and ETPM, the
"Original Indemnifiers", and each, an "Original Indemnifier");
(11) XXXXX OFFSHORE S.A., a "societe anonyme holding," incorporated under the
laws of Luxembourg with its registered office at 00 xxx Xxxxxxxxx, X-0000
Xxxxxxxxxx, registered at the R.C.S. Luxembourg under number B 43. 172
("XXXX");
(12) the companies listed in Part A of Schedule 1, each being a parent company
of an Original Indemnifier (each, a "Guarantor", and together with XXXX,
the "Guarantors");
(13) HSBC BANK PLC as arranger (the "Arranger");
(14) HSBC BANK PLC, CREDIT LYONNAIS and DNB NOR BANK ASA (formerly DEN NORSKE
BANK ASA) as issuing banks (collectively, the "Issuing Banks", and each, an
"Issuing Bank");
(15) the banks and financial institutions listed in Part B of Schedule 1, each
acting through its office at the address indicated against its name in
Schedule 1 (collectively, the "Banks", and each, a "Bank"); and
(16) HSBC BANK PLC as facility agent and security trustee with its office at
Xxxxx 00, 0 Xxxxxx Xxxxxx, Xxxxxx X00 0XX, XX (xx those capacities, the
"Agent").
WHEREAS:
(A) The Original Indemnifiers and XXXX (each of XXXX and SO BV being an
indirect parent of all the Original Indemnifiers) have requested that the
Banks and the Issuing Banks provide Bank Guarantees from time to time, upon
the terms and subject to conditions contained in this Agreement.
(B) XXXX and the other Guarantors (each being a direct or indirect parent of an
Original Indemnifier) have agreed to guarantee the Obligations, upon the
terms and subject to conditions contained in this Agreement.
(C) Each of the Banks has severally agreed to make available its respective
Commitment as set forth in Part B of Schedule 1, in the aggregate principal
amount not exceeding one hundred million Dollars ($100,000,000) for all
Banks or the Equivalent Amount in a Permitted Currency or Permitted
Currencies and assume its Proportionate Share of the Banks' Obligations,
including the indemnity of the Banks in favour of the Issuing Banks in
respect of each Bank Guarantee issued by an Issuing Bank, upon the terms
and subject to conditions contained in this Agreement.
(D) The Indemnifiers have designated the Obligors' Agent as their agent to
perform certain functions on their behalf as set forth herein in connection
with the issuance of the Bank Guarantees.
IT IS AGREED as follows:
1 DEFINITIONS AND INTERPRETATION
1.1 Definitions In this Agreement:
"Accession Agreement" means an agreement substantially in the form of
Schedule 18 (Form of Accession Agreement) for the purposes of providing an
Additional Indemnifier to become a party to this Agreement.
-2-
"Account Pledges" means account pledges in the agreed form granted over
each of Lock Box One and Lock Box Two.
"Additional Indemnifier" means each trading company that is a member of the
SO Group that hereafter becomes a party to this Agreement as an Indemnifier
in accordance with Clause 20.
"Address for Service" means c/x Xxxxx Offshore M.S. Limited of 1st Floor,
Dolphin House, Windmill Road, Sunbury-on-Thames, Middlesex TW16 7HT,
England or, in relation to any of the Obligors, such other address in
England and Wales as that Obligor may from time to time designate by no
fewer than 10 Business Days' written notice to the Agent.
"Administration" has the meaning given to such term in paragraph 1.1.3 of
the ISM Code.
"Applicable Commission Rate" means for any period of determination (i) 1%
per annum to the extent of the portion of the Bank Guarantee Outstandings
that is Cash Collateralised and (ii) 3% per annum to the extent of the
portion of the Bank Guarantee Outstandings that is not Cash Collateralised.
"Applicable Commitment Rate" means 1.5% per annum.
"Approved Budget" means the consolidated budget of the SO Group prepared on
an annual basis by XXXX, commencing with the budget for the financial year
commencing 1 December 2003 and approved by an Instructing Group, which
budget shall be in a format consistent with the form of budget dated 18
November 2003 reviewed by KPMG.
"Approved Brokers" means a firm or firms of insurance brokers appointed by
XXXX for the purposes of Schedule 14 and approved in writing by the Agent.
"Approved Shipbroker" means any of the firms of shipbrokers listed in
Schedule 19.
"Assignments" means the Senior Assignments and the Junior Assignments.
"Bank's Excess Amount" has the meaning given to such term in Clause 14.17.
"Bank Guarantee" means a performance bond, bid bond, advance payment bond,
guarantee or standby letter of credit, in a Permitted Currency, in respect
of a performance obligation of a member of the SO Group, expiring on a Bank
Guarantee Termination Date and issued under this Agreement, in a form
acceptable to and approved by the relevant Issuing Bank in its absolute
discretion.
"Bank Guarantee Commission" means the commission to be paid by each
applicable Indemnifier to the Agent pursuant to Clause 12.1.
"Bank Guarantee Outstandings" means at any time the Dollar equivalent of
the aggregate of the total amounts in each relevant Permitted Currency
actually or contingently payable by the Issuing Banks under or pursuant to
all Bank Guarantees that have been issued hereunder by the Issuing Banks
and that have not terminated in accordance with their terms, been cancelled
or, if called or drawn upon, in respect of
-3-
which all Obligations related thereto have been paid in full, such Dollar
equivalence to be determined on the basis of the Agent's spot rate of
exchange at such time.
"Bank Guarantee Termination Date" means, in relation to any Bank Guarantee,
the date falling no later than 60 months after the Issue Date of that Bank
Guarantee unless otherwise agreed by all the Banks.
"Banks' Obligations" means all liabilities and obligations of the Issuing
Banks under or pursuant to the Bank Guarantees, including under or pursuant
to any renewal, extension or variation of any Bank Guarantee and all
liabilities and obligations undertaken by each Issuing Bank to any of its
subsidiaries, affiliates or correspondents in respect of the Bank Guarantee
or any renewal, extension or variation of any Bank Guarantee.
"Blueprint" means the "Position Update and Blueprint Stage II" presented to
the Banks at a syndicate bank briefing held in London and New York on 7
August 2003.
"Business Day" means (a) a day on which banks are open for the transaction
of business of the nature contemplated by this Agreement (and not
authorised by law to close) in Xxx Xxxx Xxxx, Xxxxxx Xxxxxx xx Xxxxxxx;
Xxxxxx, Xxxxxxx; Paris, France; and Oslo, Norway; and (b) in relation to
the determination of interest rates for Euros only, a day on which the
Trans-European Automated Real Time Gross Settlement Express System (TARGET)
is operating.
"Capital Expenditure" means any expenditure made or obligation incurred
which in accordance with US GAAP is treated as an addition to the carrying
amount of a capital asset.
"Cash Collateral" means the amount of cash deposited by the Obligors'
Agent, or by an Indemnifier in respect of a Bank Guarantee issued on behalf
of such Indemnifier, in Lock Box One from time to time as security for its
Obligations, and the words "Cash Collateralise" or "Cash Collateralised"
shall have correlative meanings and be interpreted accordingly.
"Cash Management System" means a system of deposit accounts and
instructions pursuant to which all cash of the members of the SO Group are
transferred (i) to Lock Box One, to the extent required by this Agreement
and (ii) otherwise, to the extent of any operating cash in excess of
$75,000,000, all as set forth in Schedule 20.
"Cash Management System Bank" means HSBC Bank plc, or such other bank as
may be selected by the Agent from time to time to be the bank at which one
or more of the deposit accounts constituting Lock Box One and Lock Box Two
are maintained.
"Casualty Amount" means, in respect of each Vessel, an amount of $1,000,000
or the equivalent in any other currency.
"Certificate of Compliance" means a certificate materially in the form set
forth in Schedule 6, signed by the treasurer or chief financial officer of
XXXX.
"Chief Restructuring Officer" means Alix Partners Ltd.
-4-
"Commitment" means, in relation to each Bank, the Dollar amount indicated
against the name of that Bank in Part B of Schedule 1, as cancelled,
transferred or reduced from time to time in accordance with the terms of
this Agreement.
"Commitment Commission" means the commission to be paid by the Obligors'
Agent to the Agent pursuant to Clause 12.2.
"Common Shares" means common shares of XXXX of the class outstanding on the
Execution Date.
"Communication" means any notice, approval, demand, request or other
communication from one party to this Agreement to any other party to this
Agreement.
"Communications Address" means c/x Xxxxx Offshore M.S. Limited of 1st
Floor, Xxxxxxx Xxxxx, Xxxxxxxx Xxxx, Xxxxxxx-xx-Xxxxxx, Xxxxxxxxx XX00 0XX,
Xxxxxxx, fax no: x00 (0) 0000 000000 marked for the attention of Xxxxxxx
Xx-Xxxx.
"Company" means, in relation to any Vessel and at any given time, the
company responsible for the Vessel's compliance with the ISM Code pursuant
to paragraph 1.1.2 of the ISM Code.
"Consolidated Tangible Net Worth" means for XXXX and its Subsidiaries (on a
consolidated basis) at any time (a) the sum, to the extent shown on XXXX'x
consolidated balance sheet, of (i) the amount of issued and outstanding
share capital, less the cost of treasury shares, plus (or if negative,
less) (ii) the amount of surplus and retained earnings, less (b) intangible
assets as determined in accordance with US GAAP.
"Covenant Release Date" has the meaning given to such term in Clause
15.6.1.
"converted" means actually or notionally (as the case may require)
converted by the Agent, at the rate at which the Agent, in accordance with
its usual practice, is able in the London Interbank market to purchase the
Permitted Currency in which the Facility or part thereof is then
denominated with the Permitted Currency in which the Facility or part
thereof is to be denominated, on the second Business Day before the value
date for that conversion pursuant to Clause 8, and the words "convert" and
"conversion" shall be interpreted accordingly.
"Currency of Account" means, in relation to any payment to be made to a
Finance Party pursuant to any of the Facility Documents, the currency in
which that payment is required to be made by the terms of the relevant
Facility Document.
"Default" means any Event of Default or Potential Event of Default.
"Default Rate" means the rate at all times of 5% per annum above 3-month
LIBOR in effect from time to time; the change in the Default Rate being
effective with each change in 3-month LIBOR.
"Disclosed Permitted Disposals" means the disposals described in detail in
the Blueprint and set out in Schedule 8 and, with the prior consent of the
Agent, disposals
-5-
of any asset in lieu of an asset listed in Schedule 8 having a value
similar to the value of such asset listed in Schedule 8.
"DOC" means a valid Document of Compliance issued for the relevant Company
by the Administration pursuant to paragraph 13.2 of the ISM Code.
"Dollars", "US$" and "$" each means available and freely transferable and
convertible funds in lawful currency of the United States of America.
"Dutch Obligor" means SO BV and any other Obligor incorporated under the
laws of The Netherlands.
"Earnings", in relation to a Vessel, means all hires, freights, pool income
and other sums payable to or for the account of a Shipowning Guarantor in
respect of that Vessel including all remuneration for salvage and towage
services, demurrage and detention moneys, contributions in general average,
compensation in respect of any requisition for hire and damages and other
payments (whether awarded by any court or arbitral tribunal or by agreement
or otherwise) for breach, termination or variation of any contract for the
operation, employment or use of the Vessel.
"Effective Date" means the date on which the conditions set out in Clause
6.1 have been satisfied and the first Bank Guarantee is issued.
"Eligible Projects" means projects and contracts of the type generally
heretofore engaged in by the SO Group in connection with the design,
procurement, installation and servicing of offshore surface and subsurface
infrastructure for the global oil and gas industry.
"Encumbrance" means any mortgage, standard security, charge, pledge, lien,
assignment, assignation, hypothecation, preferential right, option, title
retention or trust arrangement or any other agreement or arrangement which,
in any of the aforementioned instances, has the effect of creating
security.
"Environmental Claim" means:
(a) any and all enforcement, clean-up, removal or other governmental or
regulatory action or order or claim instituted or made pursuant to any
Environmental Law or resulting from a Spill; or
(b) any claim made by any other person relating to a Spill.
"Environmental Incident" means any Spill:
(a) from any Vessel; or
(b) from any other vessel in circumstances where:
(i) any Vessel or its owner, operator or manager may be liable for
Environmental Claims arising from the Spill (other than
Environmental Claims arising and fully satisfied before the date
of this Agreement); and/or
-6-
(ii) any Vessel may be arrested or attached in connection with any
Environmental Claim arising from such Spill.
"Environmental Law" means a law, regulation or convention concerning
pollution or protection of human health or the environment.
"Equity Contribution" means one or more investments in XXXX in an aggregate
amount of not less $120,000,000 (of which gross cash proceeds shall be not
less than $100,000,000) from the issuance of Common Shares.
"Equivalent Amount" means the amount of any Permitted Currency converted
from the relevant amount of Dollars.
"Euro" means the currency of participating Member States of the European
Monetary Union, pursuant to Council Regulation (EC) 974/98 of 3 May 1998,
(as changed from time to time by the European Communities).
"Event of Default" means any of the events set out in Clause 17.2.
"Excess Amount" has the meaning given to such term in Clause 9.1.
"excess risks" in Schedule 14 means the proportion (if any) of claims for
general average, salvage and salvage charges and under the ordinary
collision clause not recoverable in consequence of the value at which the
relevant Vessel is assessed for the purpose of such claims exceeding its
insured value.
"Execution Date" means the date on which this Agreement has been executed
by each of the parties hereto.
"Executive Officers" means each of Xxx Xxxxx, Xxxxxx Xxxxxxx and Xxxxx
Xxxxxx and any replacement for any of them satisfactory to an Instructing
Group acting reasonably.
"Existing Credit Agreements" means the $440m Loan Agreement, the $55m/45m
Loan Agreement, the $44m Facility Agreement and the $28m Reimbursement
Agreement.
"Existing Credits" means the aggregate amount outstanding or credit
extended, as the case may be, at any time under the $440m Loan Agreement,
the $55m/$45m Loan Agreement, the $44m Facility Agreement and the $28m
Reimbursement Loan.
"Existing Facilities Guarantee" means the joint and several guarantee and
indemnity by the Indemnifiers and the Guarantors of the obligations of,
inter alios, Xxxxx Comex Seaway Finance B.V. and Xxxxx Offshore Inc. under
the Existing Credit Agreements and the existing bilateral bonding
agreements set forth in Schedule 23, in the agreed form and executed or to
be executed in favour of the Security Trustee.
"Existing SNSA Guarantees" means (i) the guarantee and indemnity agreement
dated 21 August 2003 executed by SNSA and SNTG as guarantors in favour of
Den norske Bank ASA (now DnB NOR Bank ASA) as agent pursuant to the $44m
Facility Agreement; (ii) the guarantee and indemnity agreement dated 30
June 2003 executed by SNSA and SNTG as guarantors in favour of Nordea Bank
Norge ASA, Grand
-7-
Cayman Branch as agent pursuant to the $55m/$45m Loan Agreement; and (iii)
the amended and restated guarantee dated 27 August 2003 executed by SNSA in
favour of Den norske Bank ASA (now DnB NOR Bank ASA) pursuant to the $28m
Reimbursement Agreement.
"Facility" means the facility for issuing Bank Guarantees made available by
the Issuing Banks and the Banks to the Indemnifiers pursuant to this
Agreement.
"Facility Amount" means, at any time, the amount of the aggregate
Commitments at such time (stated in Dollars) less the amount of the
aggregate Bank Guarantee Outstandings at such time.
"Facility Availability Period" means the period beginning on the Effective
Date and ending on the Facility Availability Termination Date.
"Facility Availability Termination Date" means the date falling 18 months
after the Execution Date or such earlier date as may result from a
reduction of the Commitments to zero pursuant to Clause 5.1 or termination
of availability pursuant to Clause 17.1.
"Facility Documents" means this Agreement, the Intercreditor, Override and
Security Trust Deed, the Mortgages together, where applicable, with
collateral deeds of covenant over the Vessels, the Assignments, the Account
Pledges, the Shipowners' Guarantees, the Factoring Agreement, the SNSA
Guarantee, the Share Pledges, and charterer's subordination undertaking and
any Manager's subordination undertaking executed pursuant to Clause 15.1.2
or 15.1.3 respectively and any other agreement or document which may at any
time be executed by any member of the SO Group and/or the SNSA Group
creating or expressed to create security over all or any part of its assets
in respect of all or any part of the Obligations of any of the Obligors or
(where the context requires) any one or more of any of the foregoing.
"Facility Period" means the period beginning on the Execution Date and
ending on the date when Bank Guarantees may no longer be issued hereunder
and all Obligations of all Obligors have been paid or satisfied and
discharged in full and the Indemnifiers have ceased to be under any further
actual or contingent liability to the Finance Parties under or in
connection with any Obligation.
"Factoring Agreement" means the factoring agreement in relation to the
assignment of earnings contained in the Junior Assignment over mv "SEAWAY
FALCON" to be made between the Security Trustee and Xxxxx Offshore A/S in
the agreed form.
"Fee Letter" means the fee letter referred to in Clause 12.5.
"Finance Parties" means the Arranger, the Issuing Banks, the Banks, the
Agent and the Security Trustee.
"French Obligor" means SO France, SOS France, SO West Africa, Sotraplex and
any other Obligor incorporated under the laws of France.
"Guarantee" means the guarantee and indemnity of the Guarantors contained
in Clause 11.
-8-
"Indebtedness" means (i) all obligations evidenced by bonds or notes
payable (whether promissory notes or otherwise), (ii) all indebtedness for
borrowed money, (iii) capitalised lease obligations on behalf of third
parties and all contingent liabilities related to debt and capital lease
obligations which, according to US GAAP, are considered probable and
estimable, (iv) all obligations for the deferred payment of the purchase
price for any assets or services (other than trade payables), and (v) all
reimbursement and other obligations with respect to performance bonds, bank
guarantees and letters of credit, whether or not matured, net of (vi) the
amount of any restricted cash deposit which may be applied by the holder of
a financial obligation referred to above to the repayment of all or part of
such financial obligation. For the avoidance of doubt Indebtedness shall
not include obligations under interest rate and currency hedging agreements
entered into by any member of the SO Group in the ordinary course of
trading and daylight overdraft exposures.
"Indemnifiers" means, collectively, the Original Indemnifiers and all
Additional Indemnifiers, if any, and an "Indemnifier" means any one of
them.
"Information Package" means the Blueprint and the other information
delivered prior to the Execution Date to the Banks and identified in
Schedule 22.
"Instructing Group" means any one or more Banks whose combined
Proportionate Shares equal or exceed sixty six and two thirds per cent
(66?%).
"Insurance Adviser" means HSBC Insurance Brokers Limited or such other
independent insurance adviser as may be selected by the Agent from time to
time to advise the Agent on the adequacy of the Insurances and compliance
with the insurance obligations set out in this Agreement.
"Insurance Proceeds Amount" means, in respect of (i) each Senior Vessel or
(ii) in the event that all Indebtedness under an Existing Credit Agreement
secured by a prior Encumbrance thereon has been repaid or fully Cash
Collateralised, in respect of that particular Junior Vessel, the amount of
insurance proceeds payable in respect of such Senior Vessel or such Junior
Vessel (after payment or Cash Collateralisation of the Indebtedness under
the Existing Credit Agreement) in the event of a Total Loss or any other
claim.
"Insurances" means all policies and contracts of insurance (including hull
and machinery, all entries in protection and indemnity or war risks
associations) which are from time to time taken out or entered into in
respect of or in connection with the Vessels or their increased value and
(where the context permits) all benefits thereof, including all claims of
any nature and returns of premium.
"Intercreditor, Override and Security Trust Deed" means the intercreditor,
override and security trust deed in the agreed form to be entered into
between, inter alios, the Security Trustee, the Indemnifiers, the
Guarantors, DnB NOR Bank ASA and Nordea Bank Norge ASA, Grand Cayman
Branch, as agents under the Existing Credit Agreements, DnB NOR Bank ASA as
lender and Xxxxx Offshore, Inc as borrower under the $28m Reimbursement
Agreement, the Agent, the Banks and the Issuing Banks.
"Interest" means interest at the Default Rate.
-9-
"ISM Code" means the International Management Code for the Safe Operation
of Ships and for Pollution Prevention (as amended, including any regulation
issued thereunder), as adopted by the Assembly of the International
Maritime Organisation on 4 November 1993 by resolution A.741 (18) and
incorporated on 19 May 1994 as chapter IX of the Safety of Life at Sea
Convention 1974.
"Issue Date", in relation to any Bank Guarantee, means the date on which
that Bank Guarantee is issued by an Issuing Bank pursuant to Clause 4.
"Issue Request" means a request, substantially in the form set out in
Schedule 5, made by the Obligors' Agent to the Agent for the issuance of a
Bank Guarantee.
"Junior Assignments" means the second priority deeds of assignment of the
Insurances, Earnings and Requisition Compensation of each Junior Vessel, in
the agreed form, executed or to be executed in favour of the Security
Trustee or, in respect of any Junior Vessel of a member of the SNSA Group,
in favour of the Agent.
"Junior Mortgages" means the second priority and/or second preferred
mortgages over each Junior Vessel, in the agreed form, executed or to be
executed in favour of the Security Trustee or, in respect of any Junior
Vessel of a member of the SNSA Group, in favour of the Agent.
"Junior Shipowners' Guarantees" means the subordinated guarantees and
indemnities of the Junior Shipowning Guarantors that are members of the SO
Group, in the agreed form, executed or to be executed in favour of the
Security Trustee.
"Junior Shipowning Guarantors" means the companies listed in Schedule 3
each being incorporated according to the law of the country indicated
against its name in Schedule 3.
"Junior Vessels" means the vessels listed in Schedule 3.
"law" means any law, statute, treaty, convention, regulation, instrument or
other subordinate legislation or other legislative or quasi-legislative
rule or measure, or any order or decree of any government, judicial or
public or other body or authority, or any directive, code of practice,
circular, guidance note or other direction issued by any competent
authority or agency (whether or not having the force of law).
"Liabilities" has the meaning given to such term in Clause 4.5.1.
"LIBOR" means the rate, rounded to the nearest four decimal places
downwards (if the digit displayed in the fifth decimal place is 1, 2, 3 or
4) or upwards (if the digit displaced in the fifth decimal place is 5, 6,
7, 8 or 9) displayed on the telerate page 3750 or, as the case may be, 3740
(or such other page or pages which replace(s) either such page for the
purposes of display of offered rates of leading banks), for deposits in the
Currency of Account of amounts equal to the amount of the relevant Bank
Guarantee Outstandings for a 3 month period or if there is no such display
rate then available for the Currency of Account for an amount comparable to
the relevant Bank Guarantee Outstandings, the arithmetic mean (rounded
upwards, if necessary, to the nearest whole multiple of 1/16%) of the
respective rates offered to the Agent for
-10-
deposits in the Currency of Account for a 3 month period by prime banks in
the London Interbank market.
"Lock Box One" means collectively one or more accounts each in the name of
the Obligors' Agent with the Cash Management System Bank denominated in
Dollars, over which the Agent has a perfected, valid and legally
enforceable fixed charge pursuant to an Account Pledge.
"Lock Box Two" means collectively one or more accounts each in the name of
the Obligors' Agent with the Cash Management System Bank denominated in a
Permitted Currency acceptable to the Cash Management System Bank over which
the Security Trustee has a perfected, valid and legally enforceable
floating charge pursuant to an Account Pledge.
"Loss Payable Clauses" means the provisions regulating the manner of
payment of sums receivable under the Insurances which are to be
incorporated in the relevant insurance documents, such Loss Payable Clauses
to be in substantially the forms set out in Schedule 16, or in such other
forms as may from time to time be agreed in writing by the Agent.
"Management Agreement" means, in relation to any Vessel, the agreement made
between the Manager and the relevant Shipowning Guarantor in respect of the
management of such Vessel.
"Manager" means (i) any member of the SO Group or (ii) such other
commercial and/or technical manager of a Vessel nominated by the Shipowning
Guarantors and approved by the Agent in its discretion.
"Material Adverse Effect" means a material adverse effect on:
(a) the business, condition (financial or otherwise), operations,
performance, properties or prospects of the SO Group taken as a whole;
(b) the ability of any member of the SO Group to perform its payment
obligations under any Facility Document; or
(c) the validity or enforceability of the Facility Documents or the rights
or remedies of any Finance Party under the Facility Documents.
"Mortgaged Vessel" means, at any relevant time, any Vessel over which the
Security Trustee or the Agent, as they case may be, has a perfected first
or second priority lien and the Agent has received the documentation listed
in Schedule 9; provided however that a Mortgaged Vessel that suffers a
Total Loss remains a Mortgaged Vessel until the expiry of the period
referred to in Clause 17.2.11(b).
"Mortgaged XXXX Vessel" means, at any relevant time, any Vessel owned by a
member of the SO Group which is a Mortgaged Vessel.
"Mortgagees' Insurances" means all policies and contracts of mortgagees'
interest insurance and any other insurance of the type referred to in
paragraph 5(a)(bb) of Schedule 14 from time to time taken out in respect of
any Vessel of a member of the
-11-
SNSA Group, by or for the benefit of the Agent, or in respect of any other
Vessel, the Security Trustee, on behalf of the Finance Parties pursuant to
this Agreement.
"Mortgages" means the Senior Mortgages and the Junior Mortgages.
"Net Disposal Proceeds" means the proceeds (including any amount received
in repayment of intercompany debt in connection with such disposal) of any
disposal by any member of the SO Group or other Shipowning Guarantor after
deducting:
(a) reasonable fees and out-of-pocket expenses incurred by the seller in
connection with such disposal;
(b) any amount necessary to discharge any liability to any creditor with a
priority claim over the disposal proceeds provided it is so applied;
(c) VAT paid or payable by the seller in connection with such disposal;
and
(d) any other tax incurred and required to be paid by the seller in
connection with such disposal (as reasonably determined by the seller,
acting in good faith, on the basis of existing rates and taking
account of any available credit, deduction or allowance).
"Norwegian Kroner" means available and freely transferable and convertible
funds in the lawful currency of the Kingdom of Norway.
"Norwegian Obligor" means SO Norway and any other Obligor incorporated
under the laws of the Kingdom of Norway.
"Notice of Assignment of Insurances" means a notice of assignment in the
form set out in Schedule 17, or in such other form as may from time to time
be required or agreed in writing by the Agent.
"Obligations" means all of the liabilities and obligations (including an
obligation to provide cash cover or deposit cash) of each Obligor to any of
the Finance Parties under or pursuant to this Agreement and each other
Facility Document to which such Obligor is a party, whether actual or
contingent, present or future and whether incurred alone or jointly or
jointly and severally with the other Obligor and in whichever currency,
including interest, commission and all other charges and expenses.
"Obligors" means, collectively, the Indemnifiers, the Guarantors, the
Shipowning Guarantors, the Pledgors, the Obligors' Agent, SNSA, SNTG and
any other member of the SO Group which is at any time during the Facility
Period liable for, or has provided security for, all or any part of the
Obligations, and "Obligor" means any one of them; provided, however, that
for purposes of Clause 7, Clause 15 and Clause 17), the term Obligor or
Obligors does not include SNSA or SNTG or any Shipowning Guarantor that is
not a member of the SO Group.
"Obligors' Agent" means Seaway UK or any other Indemnifier or Guarantor
designated by XXXX as the agent of the Indemnifiers to perform certain
functions on their behalf as set forth herein in connection with the
issuance of the Bank Guarantees, and approved by the Agent.
-12-
"Paying Obligor" has the meaning given to such term in Clause 1.3.4.
"Permitted Currency" means (i) Dollars, (ii) Euros, (iii) Sterling, (iv)
Norwegian Kroner, and (v) to the extent selected by an Indemnifier and
acceptable to an Instructing Group in their discretion, any other lawful
currency, including that of Indonesia (namely Indonesian Rupiah), Tunisia
(namely Tunisian Dinar), Saudi Arabia (namely Saudi Riyal) and India
(namely Indian Rupiah).
"Permitted Indebtedness" means (i) the Existing Credits, (ii) Permitted
Short Term Indebtedness, (iii) Subordinated Debt up to $50,000,000, (iv)
Indebtedness outstanding under the SNSA Liquidity Line, (v) any
Indebtedness that refinances the Existing Credits but not in excess of the
amount outstanding at the time of such refinancing, (vi) any Indebtedness
arising under the Facility Documents, (vii) any Indebtedness under the
existing bonding facilities set forth in Schedule 21 for the amounts
existing at the Execution Date, (viii) unsecured Indebtedness under any
bonding facility entered into by a member of the SO Group after the date
hereof, (ix) upon approval of the Agent, acting on the instructions of an
Instructing Group, any other Indebtedness under any bonding facility
entered into by a member of the SO Group after the date hereof, (x) after
the Facility Availability Termination Date, any other Indebtedness under
any secured bonding facility entered into by a member of the SO Group after
the date hereof for which collateral (including cash collateral not
exceeding $25,000,000) is permitted by the Intercreditor, Override and
Security Trust Deed, and (xi) other Indebtedness in respect of local
bonding facilities not exceeding $3,000,000 in the aggregate at any one
time outstanding.
"Permitted Liens" means (i) any Encumbrance for salvage and any Encumbrance
arising either by operation of law or which is otherwise incidental to the
normal conduct of the business of the relevant Obligor which is discharged
in the ordinary course of business but in any event does not exist for more
than 60 days; (ii) any Encumbrance created pursuant to the Existing Credit
Agreements and existing on the Execution Date; (iii) any Encumbrance
arising under or evidenced by any Facility Document; (iv) any Encumbrance
existing on the date of this Agreement and listed in Schedule 12; or (v)
any Encumbrance relating to assets which become the property of the SO
Group after the date of this Agreement provided that such Encumbrance was
not created in anticipation or in connection with such acquisition (unless
reflected in the Approved Budget) and does not extend to any assets other
than those acquired (including accounts receivable attributable thereto
where such accounts receivables security interest is ancillary to the
security interest in the associated fixed costs as part of an asset based
financing).
"Permitted Short Term Indebtedness" means any unsecured indebtedness of the
SO Group (other than intercompany indebtedness of the SO Group) incurred
for working capital and short term liquidity in an amount of up to
$75,000,000.
"Pledgors" means each company which executes a Share Pledge and/or an
Account Pledge.
"Pollutant" means and includes oil and its products, any other polluting,
toxic or hazardous substance and any other substance whose release into the
environment is regulated or penalised by Environmental Laws.
-13-
"Potential Event of Default" means any event which, with the giving of
notice or the passage of time or both, would constitute an Event of
Default.
"Pounds Sterling", "Sterling" and "(pound)" each means the lawful currency
for the time being of the United Kingdom.
"Principal Subsidiary" means any member of the SO Group having total assets
exceeding 10% of the consolidated assets of the SO Group and/or having
during the last four fiscal quarters accounted for more than 10% of the
consolidated turnover of the SO Group. "Proceedings" means any suit, action
or proceedings begun by any of the Finance Parties arising out of or in
connection with the Facility Documents.
"Proportionate Share" means, for each Bank, its percentage of the
Commitments (or following the Effective Date, the Bank Guarantee
Outstandings, if any) indicated against the name of that Bank in Part B of
Schedule 1, as amended by any Transfer Certificate executed from time to
time.
"protection and indemnity risks" in Schedule 14 means the usual risks
(including oil and pollution cover) covered by a United Kingdom protection
and indemnity association or a protection and indemnity association which
is managed in London (including the proportion (if any) of any sums payable
to any other person or persons in case of collision which are not
recoverable under the hull and machinery policies by reason of the
incorporation in such policies of Clause 8 of the Institute Time Clauses
(Hulls) (1/11/95) or the Institute Amended Running Down Clause (1/10/71) or
any equivalent provision).
"Qualifying Collateral" means the Cash Collateral and the Mortgaged XXXX
Vessels.
"Registrar of Ships" means, in relation to any Vessel, the registrar,
commissioner or representative of the state or territory in which such
Vessel is registered who is duly authorised and empowered to register the
Vessel, the relevant Mortgage and the relevant Management Agreement.
"Relevant Currency" means, in respect of all or any part of the Banks'
Obligations, the currency in which the Agent is liable to make payment of
that part of the Banks' Obligations.
"Repeating Representations" means the representations and warranties
contained in Clauses 7.1, 7.3, 7.4 and 7.5.
"Requisition Compensation" means all compensation or other money which may
from time to time be payable to the Shipowning Guarantors as a result of
any Vessel being requisitioned for title or in any other way compulsorily
acquired (other than by way of requisition for hire).
"Security Trustee" has the meaning given to such term in the Intercreditor,
Override and Security Trust Deed.
-14-
"Senior Assignments" means the first priority deeds of assignment of the
Insurances, Earnings and Requisition Compensation in respect of each Senior
Vessel, in the agreed form, executed or to be executed in favour of the
Security Trustee.
"Senior Mortgages" means the first priority and/or first preferred
mortgages over each Senior Vessel, in the agreed form, executed or to be
executed in favour of the Security Trustee.
"Senior Shipowners' Guarantee" means the guarantees and indemnities of the
Senior Shipowning Guarantors, in the agreed form, executed or to be
executed in favour of the Security Trustee.
"Senior Shipowning Guarantors" means the companies listed in Schedule 2
each being incorporated according to the law of the country indicated
against its name in Schedule 2.
"Senior Vessels" means the vessels listed in Schedule 2.
"Share Pledges" means the first priority pledges or charges over shares or
other equity interests of certain members of the SO Group, in the agreed
form, executed or to be executed in favour of the Security Trustee
including the Share Pledges listed in Part A and Part B of Schedule 4.
"Shipowners' Guarantees" means the Junior Shipowners' Guarantees and the
Senior Shipowners' Guarantees.
"Shipowning Guarantors" means the Junior Shipowning Guarantors and the
Senior Shipowning Guarantors.
"SMC" in relation to any Vessel means a valid safety management certificate
issued for the Vessel by or on behalf of the Administration pursuant to
paragraph 13.4 of the ISM Code.
"SMS" in relation to any Vessel, means a safety management system for the
Vessel developed and implemented in accordance with the ISM Code and
including the functional requirements, duties and obligations required by
the ISM Code.
"SNSA" means Xxxxx-Xxxxxxx S.A., a company incorporated under the laws of
Luxembourg with its registered office at 00 Xxxxxx Xxxxxxxx, X-0000
Xxxxxxxxxx.
"SNSA Guarantee" means the guarantee and indemnity of SNSA and SNTG for
such portion of the Obligations from time to time that when aggregated with
the Indebtedness guaranteed by the Existing SNSA Guarantees results in the
total amount of Indebtedness of the SO Group guaranteed by SNSA and SNTG
not exceeding $96,000,000, in the agreed form and executed or to be
executed in favour of the Agent.
"SNSA Group" means SNSA and its Subsidiaries.
"SNSA Liquidity Line" means the committed line of credit in the amount of
$50,000,000 extended by SNTG to members of the SO Group pursuant to the
facility agreement dated as of 30 June 2003 and restated as of 21 August
2003 for working
-15-
capital and other corporate purposes for a period ending on or after 30
November 2004, the availability of such committed line of credit guaranteed
by SNSA on 30 June 2003.
"SNTG" means Xxxxx-Xxxxxxx Transportation Group Ltd., a corporation
incorporated under the laws of Liberia with its registered office at 00
Xxxxx Xxxxxx, Xxxxxxxx, Xxxxxxx.
"SO Group" means XXXX and its Subsidiaries.
"Spill" means any actual or threatened emission, spill, release or
discharge of a Pollutant into the environment.
"Subordinated Debt" means the $50,000,000 of subordinated debt originally
loaned to SO BV by SNTG.
"Subordinated Note" means a note in form and substance satisfactory to the
Agent dated 30 June 2003 evidencing the Subordinated Debt or any portion
thereof.
"Subsidiary" means a subsidiary undertaking, as defined in section 258
Companies Act 1985 or any analogous definition under any other relevant
system of law.
"Surety" means any person (other than any Indemnifier or any Guarantor) who
has given or who may in the future give to the Finance Parties or any of
them any security, guarantee or indemnity for or in relation to the
Obligations of an Indemnifier.
"Taxes" means all taxes, levies, imposts, duties, charges, fees, deductions
and withholdings (including any related interest and penalties) and any
restrictions or conditions resulting in any charge, other than taxes
levies, imposts, duties, charges, fees, deductions and withholdings
(including any related interest and penalties) on the overall net income of
a Finance Party or branch thereof, and "Tax" and "Taxation" shall be
interpreted accordingly.
"Total Loss", in relation to any Vessel means:
(a) an actual, constructive, arranged, agreed or compromised total loss of
that Vessel; or
(b) the requisition for title, compulsory acquisition, nationalisation or
expropriation of that Vessel by or on behalf of any government or
other authority (other than by way of requisition for hire); or
(c) the capture, seizure, arrest, detention or confiscation of that
Vessel, unless the Vessel is released and returned to the possession
of the relevant Shipowning Guarantor within two months after such
capture, seizure, arrest, detention or confiscation.
"Transfer Certificate" means a certificate materially in the form set forth
in Schedule 7 signed by a Bank and a Transferee whereby:
-16-
(a) such Bank seeks to procure the transfer to such Transferee of all or a
part of such Bank's rights and obligations under this Agreement upon
and subject to the terms and conditions set out in Clause 21.4; and
(b) such Transferee undertakes to perform the obligations it will assume
as a result of delivery of such certificate to the Agent as is
contemplated in Clause 21.4.
"Transfer Date" means, in relation to any Transfer Certificate, the
effective date for the transfer determined in accordance with Clause 21.4.
"Transferee" means a bank or other financial institution to which a Bank
seeks to transfer all or part of such Bank's rights and obligations under
this Agreement.
"Trust Property" means:
(a) the benefit of the covenant contained in Clause 14; and
(b) all benefits arising under (including all proceeds of the enforcement
of) each of the Facility Documents (other than this Agreement), with
the exception of any benefits arising solely for the benefit of the
Issuing Banks or the Agent.
"US GAAP" means the generally accepted accounting principles in the United
States of America, from time to time in effect, provided that if XXXX
wishes or is required by US GAAP to change accounting principles within the
applicable rules of US GAAP, XXXX shall notify the Agent together with an
explanation of the effects on the financial covenants contained in this
Agreement. Should an Instructing Group and/or XXXX find that such change
will impact upon the result of the calculation of the financial covenants
contained in this Agreement, an Instructing Group will, following
consultation with XXXX, stipulate amendments to the financial covenants so
that the ratio of SO Group's performance in respect of the covenants
reflects the position which would have been the case had no changes to
XXXX'x accounting principles taken place and pending such agreement
compliance with such covenants shall be calculated as if such change had
not been made.
"US Obligor" means SO US or Xxxxx Comex Seaway Holdings Inc. and any other
Obligor incorporated under the laws of any State of the United States of
America.
"Value of Qualifying Collateral" means at any time of determination, (i)
the Value of Qualifying Vessel Collateral at such time, plus (ii) an amount
equal to 100% of the Cash Collateral at such time; provided, however, that
in the event that applicable law or any Facility Document limits any
portion of the Qualifying Collateral from securing all of the Obligations,
the value attributable to such portion of the Qualifying Collateral
pursuant to the foregoing calculations shall not exceed the amount of
Obligations outstanding at such time which are secured by such portion of
the Qualifying Collateral.
"Value of Qualifying Vessel Collateral" means, at any time of
determination, an amount equal to the aggregate of the most recent
Valuations of all Mortgaged XXXX Vessels at such time; provided, however,
that (i) in respect of any Junior Vessel of a member of the SO Group, the
value attributable to such Junior Vessel shall be the
-17-
difference, if any, between the value of such Junior Vessel and 120% of the
principal amount of the Indebtedness secured by any prior Encumbrance on
such Junior Vessel and (ii) in the event that applicable law or any
Facility Document limits any portion of the Qualifying Collateral from
securing all of the Obligations, the value attributable to such portion of
the Qualifying Collateral pursuant to the foregoing calculations shall not
exceed the amount of Obligations outstanding at such time which are secured
by such portion of the Qualifying Collateral.
"Valuation" means, in relation to a Vessel, the arithmetic mean of the most
recent written valuations of that Vessel expressed in Dollars prepared by
two firms from the list of Approved Shipbrokers, one appointed by the Agent
and the other appointed by the Obligors' Agent, unless either the Agent or
the Indemnifiers disagree with either one of such valuations, in which
event the Agent shall appoint a third firm from the list of Approved
Shipbrokers and the valuation of the Vessel shall be the arithmetic average
of all three such valuations. Such valuations shall be prepared at the
Indemnifier's expense, without a physical inspection (unless such physical
inspection is requested by the Agent), on the basis of a sale for prompt
delivery for cash at arm's length between a willing buyer and a willing
seller without the benefit of any charterparty or other engagement unless
an alternative basis of valuation is requested by the Agent, and shall not
include any item of equipment of material value on board of any Vessel
which are not owned by the relevant Shipowning Guarantor or are not an
integral part of the relevant Vessel.
"VAT" means value added tax charged in accordance with the provisions of
the Value Added Tax Xxx 0000, and any other tax on value or turnover which
is enacted in addition to or in substitution for it and any other tax of a
similar nature which may be imposed in any jurisdiction from time to time.
"Vessels" means the Senior Vessels and the Junior Vessels, and in each case
everything now or in the future belonging to them on board and ashore.
"war risks" in Schedule 14 includes those risks covered by the standard
form of English marine policy with Institute War and Strikes Clauses Hull -
Time (1/11/95) attached or similar cover.
"$28m Reimbursement Agreement" means the amended and restated reimbursement
agreement dated 27 August 2003 between Xxxxx Offshore, Inc. as borrower and
Den norske Bank ASA (now DnB NOR Bank ASA) as lender.
"$28m Reimbursement Loan" means the aggregate amount outstanding at any
time under the $28m Reimbursement Agreement.
"$44m Facility Agreement" means the $44,000,000 secured guarantee facility
dated 21 August 2003 made between Xxxxx Comex Seaway Finance B.V., XXXX,
the banks listed in Schedule 1 thereto as lenders and Den norske Bank ASA
(now DnB NOR Bank ASA) as agent, security trustee and issuing bank.
"$440m Loan Agreement" means the $440,000,000 multicurrency revolving
credit agreement dated 22 September 2000 between (inter alios) Xxxxx Comex
Seaway Finance B.V. as borrower, XXXX as guarantor, the Banks and others,
as lenders, Den
-18-
norske Bank ASA (now DnB NOR Bank ASA) as facility agent and security
trustee and Den norske Bank ASA (now DnB NOR Bank ASA) and others as
arrangers.
"$55m/$45m Loan Agreement" means the amended and restated $55,000,000 loan
and $45,000,000 guarantee facility agreement dated 9 July 2002 made between
Xxxxx Comex Seaway Finance B.V., XXXX, the banks listed in schedule 1
thereto as lenders and Nordea Bank Norge ASA, Grand Cayman Branch as agent
and security trustee.
1.2 Interpretation In this Agreement:
1.2.1 words denoting the plural number include the singular and
vice versa;
1.2.2 words denoting persons include corporations, partnerships,
associations of persons (whether incorporated or not) or
governmental or quasi-governmental bodies or authorities and
vice versa;
1.2.3 references to Recitals, Clauses and Schedules are references
to recitals and clauses of and schedules to, this Agreement;
1.2.4 references to this Agreement include the Recitals and the
Schedules;
1.2.5 the headings and contents page(s) are for the purpose of
reference only, have no legal or other significance, and
shall be ignored in the interpretation of this Agreement;
1.2.6 references to any document (including, without limitation,
to all or any of the Facility Documents) are, unless the
context otherwise requires, references to that document as
amended, supplemented, novated or replaced from time to
time;
1.2.7 references to statutes or provisions of statutes are
references to those statutes, or those provisions, as from
time to time amended, varied, replaced or re-enacted;
1.2.8 references to any of the Finance Parties include its
successors, Transferees and permitted assignees;
1.2.9 references to times of day are to London time unless
otherwise stated;
1.2.10 the term "including" when used in any Facility Document
means including without limitation except in the computation
of time periods;
1.2.11 the words "herein", "hereof" and "hereunder" and similar
words refer to this Agreement as a whole, and not to any
particular Clause in or Schedule to this Agreement;
1.2.12 a reference to a document in the "agreed form" means a
document in the form scheduled to this Agreement or agreed
between XXXX and the Agent; and
1.2.13 a reference to "set-off" shall be construed so as to include
analogous rights under the applicable laws of any relevant
jurisdiction.
-19-
1.3 Joint and Several Liability of Obligors; Limitations and Rights of
Contribution
1.3.1 All guarantees, obligations, covenants, representations,
warranties and undertakings in or pursuant to the Facility
Documents assumed, given, made or entered into by any
Indemnifier or any Guarantor shall be to the fullest extent
permitted by applicable law assumed, given, made or entered
into by the Indemnifiers and the Guarantors jointly and
severally; provided, however, that notwithstanding the
foregoing:
(a) the Obligations of any Norwegian Obligor under this
Agreement and under any other Facility Document shall
not extend to any Obligation which, if such Obligation
did so extend, would cause an infringement of any
applicable mandatory laws in the Kingdom of Norway,
including sections 8-7 cf. sections 1-3 cf. 1-4 of the
Norwegian Limited Liability Companies Xxx 0000; and
(b) the Obligations of:
(i) any French Obligor, other than Serimer SARL and
Xxxxx Comex Seaway S.A., under this Agreement and
under any other relevant Facility Document after
giving effect to Clauses 1.3.3 and 1.3.4 shall be
for a maximum amount corresponding to 95%, and
(ii) Serimer SARL or Xxxxx Comex Seaway S.A. under any
relevant Facility Document after giving effect to
Clauses 1.3.3 and 1.3.4 shall be for a maximum
amount corresponding to 80%,
of the higher of the Net Worth of such French Obligor
on the Execution Date and the Net Worth of such French
Obligor at the time of enforcement of such Obligation,
and any interest, indemnities, fees and accessories,
shall be limited to the value of the securities
("instruments financiers"), monies and other rights and
security interests registered in or granted pursuant to
any relevant Facility Document. For purposes hereof,
"Net Worth" means, in respect of any French Obligor,
such French Obligor's net worth ("capitaux propres")
(including the registered share capital, share premium,
legal and statutory reserves, other reserves, profits
or losses carried forward, investment subsidies and
regulated provisions) as shown in the most recent
financial statements ("comptes annuels") of such French
Obligor as certified by the statutory auditors and
available at the Execution Date or the date of its
enforcement hereunder, as the case may be.
1.3.2 Any term or provision of this Agreement or any other
Facility Document to the contrary notwithstanding, the
maximum aggregate amount of the Obligations for which any US
Obligor shall be liable shall not exceed the maximum amount
for which it can be liable without rendering this Agreement
or any other Facility Document, as it relates to such US
Obligor, subject to avoidance under applicable law relating
to fraudulent conveyance
-20-
or fraudulent transfer (including Section 548 of the
Bankruptcy Code or any applicable provisions of comparable
state law).
1.3.3 To the extent that any Indemnifier or any Guarantor other
than XXXX and SO BV shall be required hereunder to pay a
portion of the Obligations in excess of the amount of
economic benefit actually received by such Indemnifier or
such Guarantor, XXXX and SO BV, jointly and severally, agree
to reimburse each such Indemnifier and each such Guarantor
for such excess.
1.3.4 To the extent that any Indemnifier or any Guarantor other
than XXXX and SO BV (a "Paying Obligor") shall be required
hereunder to pay a portion of the Obligations exceeding the
greater of (a) the amount of the economic benefit actually
received by such Paying Obligor from the Facility and (b)
the amount such Paying Obligor would otherwise have paid if
such Paying Obligor had paid the aggregate amount of the
Obligations (excluding the amount thereof repaid by other
Indemnifiers or Guarantors) in the same proportion as the
net worth of such Paying Obligor at the Execution Date bears
to the aggregate net worth of all the Indemnifiers or
Guarantors, as the case may be, at the Execution Date, then
each other such Indemnifier and each other such Guarantor,
as the case may be, agrees to reimburse the Paying Obligor
for the amount of such excess, pro rata, based on the
respective net worths of such other Indemnifiers and the
Guarantors, as the case may be, at the Execution Date (it
being stipulated, for the avoidance of doubt, that the
aggregate liability of any French Obligor under Clause 1.3.1
and under this Clause 1.3.4 shall not exceed the maximum
amount referred to in Clause 1.3.1(b).
1.3.5 To the extent that the Obligors' Agent shall pay any of the
Obligations, including by way of application of any funds
deposited by the Obligors' Agent in Lock Box One or Lock Box
Two, the intercompany debt owed by the Obligors' Agent to
XXXX or SO BV shall be pro tanto reduced and deemed
satisfied and discharged.
1.3.6 Each of the Indemnifiers and the Guarantors agrees that any
rights which it may have at any time during the Facility
Period by reason of the performance of its obligations under
the Facility Documents to be indemnified or reimbursed by or
to receive contribution from or to have rights of
subrogation against any other Indemnifier, Guarantor or
Surety and/or to take the benefit of any security taken by
the Finance Parties pursuant to the Facility Documents shall
be exercised, delayed or subordinated to the Obligations, in
such manner and on such terms as the Agent may require. Each
of the Indemnifiers and the Guarantors further agrees to
hold any sums received by it as a result of its having
exercised any such right on trust for the Agent absolutely.
This provision shall in no way limit Clause 4.5.4.
1.3.7 Each of the Indemnifiers and the Guarantors agrees that it
will not at any time during the Facility Period claim any
set-off or counterclaim against any other Indemnifier or
Guarantor in respect of any liability owed to it by any
other Indemnifier or Guarantor, nor prove in competition
with any
-21-
Finance Party in any liquidation of (or analogous proceeding
in respect of) any other Indemnifier or Guarantor in respect
of any payment made under the Facility Documents or in
respect of any sum which includes the proceeds of
realisation of any security held by any of the Finance
Parties for the repayment of the Obligations.
1.3.8 Subject to the Intercreditor, Override and Security Trust
Deed, the Finance Parties shall be free, and are hereby
authorised by the Obligors, to apply any payment from any
Obligor and any recovery from enforcement of any security to
such of the Obligations in such order and at such time as
will maximise the recovery of the Finance Parties in respect
of all of the Obligations and there shall be no marshalling
obligation imposed upon any Finance Party or asserted
against it.
1.3.9 Each of the Indemnifiers appoints the Obligors' Agent as its
agent for the purposes set forth in this Agreement and
hereby ratifies, confirms and approves all actions taken by
the Obligors' Agent in connection with this Agreement.
Notwithstanding that the actions of the Obligors' Agent may
affect rights and obligations of any Obligor, and without
further reference to or the consent of such Obligor, such
Obligor shall, as regards each of the other parties to this
Agreement and the other Facility Documents, be bound thereby
as though it has itself taken such action.
2 THE FACILITY
2.1 The Facility Subject to the terms of this Agreement, the Xxxxx xxxxx
to the Indemnifiers the Facility whereby during the Facility
Availability Period the Banks, when requested by the Obligors' Agent
pursuant to an Issue Request, will procure an Issuing Bank to issue,
for the account of each Indemnifier referred to in any such Issue
Request, Bank Guarantees denominated in a Permitted Currency, up to an
aggregate principal amount at any one time outstanding not to exceed
the Facility Amount at such time.
2.2 Nature of the Banks' rights and obligations hereunder
2.2.1 Banks' Commitments No Bank is obliged to participate in the
issuance of any Bank Guarantee if to do so would cause the
aggregate amount of its maximum potential liability directly
and/or under Clause 4.6 in respect of the Bank Guarantee
Outstandings (being in the case of any Issuing Bank in
respect of any Bank Guarantee issued hereunder by it in its
capacity as Issuing Bank the Bank Guarantee Outstandings net
of the amount thereof for which it is counter indemnified by
the other Banks under Clause 4.6) to exceed its Commitment.
2.2.2 Obligations several The obligations of each Finance Party
under this Agreement are several. The failure of a Finance
Party to carry out its obligations under this Agreement
shall not relieve any other party to this Agreement of its
obligations under any Facility Document. No Finance Party
shall be responsible for the obligations of any other
Finance Party under this Agreement.
-22-
2.2.3 Rights several The Obligations of the Obligors to each of
the Finance Parties under each of the Facility Documents are
(without prejudice to Clause 1.3) owed to each of them as
separate and independent obligations to such Finance Party.
Each Finance Party may, except as otherwise stated herein,
separately enforce its rights hereunder without joining in
any other Finance Party.
3 PURPOSE AND RESPONSIBILITY
3.1 Purpose The Facility shall be available for the issuance of Bank
Guarantees to support performance obligations of the Indemnifiers in
connection with contractual arrangements entered into or to be entered
into by such Indemnifiers in respect of Eligible Projects. For the
avoidance of doubt no Bank Guarantee may be issued in support of any
financing obligation or Indebtedness.
3.2 Illegality The Indemnifiers undertake that no Bank Guarantee will be
requested if its issuance would in any way be illegal under, or would
cause the invalidity or unenforceability (in each case in whole or in
part) of any Facility Document, under any applicable law.
3.3 Responsibility Without prejudice to the foregoing and the remaining
provisions of this Agreement, none of the Finance Parties shall be
bound to enquire as to the use or application of any Bank Guarantee
issued hereunder, nor shall any of them be responsible for or for the
consequences of such use or application.
4 BANK GUARANTEES
4.1 Delivery of Request The Obligors' Agent may request that an Issuing
Bank issue a Bank Guarantee for the benefit of an Indemnifier by
delivering to the Agent prior to 2.00 p.m. on the seventh Business Day
(or such earlier date as the Agent may notify the Obligors' Agent from
time to time) before the proposed Issue Date, a duly completed Issue
Request, attaching the form of Bank Guarantee to be issued. The Agent
will deliver such Issue Request to the Issuing Bank specified in the
Issue Request and/or to one or more other Issuing Banks as the Agent
deems to be appropriate for the issuance of the Bank Guarantee
requested therein.
4.2 Mechanics Upon receipt by an Issuing Bank of the proposed form of Bank
Guarantee required to be issued together with the Issue Request, such
Issuing Bank shall decide within five Business Days of receipt of the
Issue Request whether or not to issue that Bank Guarantee. The Issuing
Bank shall notify the Agent and the Obligors' Agent within two
Business Days of its decision not to issue the requested Bank
Guarantee and of its reasons therefor, and if applicable, of any
changes in the form of requested Bank Guarantee on the basis of which
it would determine to issue the requested Bank Guarantee. If no Bank
Guarantee Termination Date is specified in the Issue Request, the
Issuing Bank shall request the Agent to seek consent of each Bank
prior to consenting to issue such Bank Guarantee and in such event the
Bank Guarantee Termination Date shall be the last day of the 60th
month from the relevant Issue Date and shall be subject to Clause 9.2.
For the avoidance of any doubt, the Issuing Bank shall have full
discretion to refuse to issue any Bank Guarantee in respect of any tax
or customs bond or contractor licence without any need to specify the
reasons for such refusal. The relevant Issuing Bank and the other
Finance Parties
-23-
(as applicable) shall not be liable for any loss, cost, claim or
expense suffered or incurred by any Indemnifier or any other person as
a consequence of the relevant Issuing Bank not issuing any Bank
Guarantee so requested. Once a Bank Guarantee has been approved by the
relevant Issuing Bank the Issue Request in relation to such Bank
Guarantee shall constitute a warranty by the Obligors' Agent and the
relevant Indemnifier that the conditions set out in Clause 6.3 will
have been satisfied on or before the Issue Date requested.
4.3 Form of Issue Request
4.3.1 Each Issue Request shall be substantially in the form of
Schedule 5, signed by the Obligors' Agent and specify:
(a) the Indemnifier on behalf of which the Bank Guarantee
is requested to be issued;
(b) the proposed Issue Date, which shall be a Business Day
falling prior to the Facility Availability Termination
Date;
(c) the amount of the proposed Bank Guarantee which shall
not result in the Bank Guarantee Outstandings (after
giving effect to the issuance of all Bank Guarantee for
which an Issue Request has been received by the Agent)
exceeding at the date such Issue Request is received
the Facility Amount (which for the purpose of this
Clause 4.3.1(c) shall be reduced by the amount of any
other Bank Guarantee in respect of which an Issue
Request has therefore been delivered to the Agent but
which has not yet been issued at or prior to that
proposed Issue Date specified in that Issue Request);
(d) the currency (which shall be a Permitted Currency) of
the Bank Guarantee requested;
(e) the requested Issuing Bank; and
(f) in relation to each Bank Guarantee (i) its Bank
Guarantee Termination Date (unless none, as may be
permitted by Clause 4.2), (ii) the name and address of
the beneficiary, (iii) the beneficiary's receiving bank
account (if known), (iv) reasonable details of the
liabilities payment of which is to be assured by the
Bank Guarantee, and (v) the name of the Eligible
Project to which such Bank Guarantee relates or, in
respect of any tax or customs bond or contractor
licence, all relevant details for such bond or licence.
4.3.2 Each Issue Request shall be irrevocable and the applicable
Indemnifier shall be bound to accept the issue of a Bank
Guarantee in accordance with such Issue Request. The Agent
shall promptly notify each Bank of the Agent's receipt of
each Issue Request.
4.3.3 Together with each Issue Request which relates to any
contract with anticipated revenues to the SO Group in excess
of $60,000,000, the Obligors' Agent shall deliver an
information package containing (i) a
-24-
memorandum from XXXX identifying any material differences
between the original tender documentation and the final
contract that has been awarded and explaining the reasons
for such differences, (ii) a memorandum from XXXX
identifying and explaining any material differences between
any term in such final contract and the standard terms
required by XXXX'x risk management system and (iii) a
certification by the Executive Officers that they have
reviewed the related information package and that they and
the board of directors of XXXX have approved such final
contract.
4.3.4 Notwithstanding any other provision of this Agreement, an
Indemnifier may request the issue of a Bank Guarantee for
the benefit of a joint venture company in which such
Indemnifier holds shares or other equity interests upon the
unanimous approval of the Banks and the provision of a
counter-indemnity from such joint venture company in form
and substance satisfactory to the Agent.
4.4 Issue of Bank Guarantee
4.4.1 On the terms and subject to the conditions contained in this
Agreement, on the proposed Issue Date for any Bank Guarantee
the relevant Issuing Bank (as determined by the Agent) will
issue, in the form approved by such Issuing Bank after
consultation with the Agent, the Bank Guarantee requested by
the relevant Issue Request by delivering the same to or to
the order of the beneficiary (with a copy to the Agent, the
Obligors' Agent and the relevant Indemnifier) or, if
requested by the Obligors' Agent, to or to the order of the
Obligors' Agent (with a copy to the Agent and the relevant
Indemnifier). Upon the issue of each Bank Guarantee the
relevant Issuing Bank shall promptly notify the Agent who
shall promptly notify each Bank.
4.4.2 Simultaneously with any reduction of the Commitments in
accordance with Clause 5.1 and/or Clause 5.3, the Commitment
of each Bank will reduce so that the Commitments of the
Banks in respect of the reduced Facility Amount remain in
accordance with their respective Proportionate Shares.
4.5 Counter-Indemnity from the Indemnifier
4.5.1 Without prejudice to Clause 4.6, the Indemnifiers will
indemnify and hold harmless and keep each Finance Party
indemnified and held harmless from and against all
liabilities, losses, damages, claims, costs, demands and
actions (the "Liabilities") which such Finance Party may
suffer or incur in connection with each Bank Guarantee
issued hereunder and any payment made pursuant to it, except
to the extent that any such Liabilities result from such
Finance Party's gross negligence, fraud or wilful
misconduct. The obligations of the Indemnifiers under this
Clause 4.5.1 are joint and several and limited as and to the
extent provided in Clause 1.3.
4.5.2 The Indemnifiers irrevocably direct each Issuing Bank to pay
without further confirmation or investigation from or by it
any demand appearing to be validly made pursuant to any Bank
Guarantee issued by it or on its behalf. Where any Bank
Guarantee calls for certificates or other documents, the
relevant Issuing Bank may assume, without investigation,
-25-
that the certificates or documents tendered are duly signed
by the person by whom they appear to be signed and are (and
any matters stated therein are) genuine and correct. Without
prejudice to the rights of the relevant Issuing Bank under
the Uniform Customs and Practice for Documentary Credits
(1993 Revision) (ICC Publication No. 500) (which, to the
extent not inconsistent with the express terms of this
Agreement and/or any Bank Guarantee, shall apply in relation
to all Bank Guarantees), the Indemnifiers agree to reimburse
each Finance Party forthwith on written demand of such
Finance Party for any amounts paid by such Finance Party
(including for avoidance of doubt any amounts paid by an
Issuing Bank in respect of any Bank Guarantee) together with
interest on such amounts (i) at a rate of 3% per annum above
LIBOR, from the date such amounts are paid by such Finance
Party until and including two Business Days after such
amounts are demanded by such Finance Party from the relevant
Indemnifier, and thereafter (ii) at a rate determined in
accordance with Clause 10.1 until reimbursement as
aforesaid. For the avoidance of doubt, and for the purposes
of Clause 10.1, amounts demanded in accordance with this
Clause 4.5.2 shall be due on the second Business Day after
such demand. The obligations of the Indemnifiers under this
Clause 4.5.2 are joint and several and limited as and to the
extent provided in Clause 1.3.
4.5.3 The obligations of the Indemnifiers under this Clause 4.5
shall not be impaired by (a) any waiver or time granted to
or by any Finance Party, (b) any release or dealings with
any rights or security by any Finance Party (including,
without limitation, under the Facility Documents), (c) any
invalidity of any Bank Guarantee, or (d) any other
circumstances which might impair such obligations.
4.5.4 So long as any amount is or is capable of becoming
outstanding by any Obligor to any of the Finance Parties
under any of the Facility Documents or any Commitment is in
force, the Indemnifiers shall not by virtue of any payment
made by it pursuant to this Clause 4.5 or by virtue of any
realisation of security made in respect of its obligations
under this Clause 4.5, claim or exercise any right of
subrogation, contribution or indemnity against any member of
the SO Group in competition with any Finance Party.
4.5.5 Each Issuing Bank will promptly notify the Obligors' Agent
of any demand received by it and made (or purporting to be
made) pursuant to any Bank Guarantee and of any payment made
by it on account of such demand.
4.6 Banks' Counter-guarantee
4.6.1 Each Bank as primary obligor guarantees to each Issuing Bank
on a full indemnity basis, on demand by each Issuing Bank
from time to time, the due performance by the Indemnifiers
in relation to each Bank Guarantee issued by such Issuing
Bank, of the Obligations of the Indemnifiers to the Issuing
Bank under Clause 4.5, provided that the liability of each
Bank under this Clause 4.6.1 in relation to any particular
default in performance of such obligations by an Indemnifier
shall not exceed such Bank's Proportionate Share of the
amount in default.
-26-
4.6.2 The Issuing Banks shall promptly notify each Bank and the
Agent of any demand served on it under any Bank Guarantee
issued by it and each payment made pursuant thereto and of
any failure by an Indemnifier in performing its obligations
under Clause 4.5.
4.6.3 The provisions set out in Schedule 10 shall apply to the
guarantees of each of the Banks in this Clause 4.6 so that
such guarantees shall be upon the terms set out in this
Clause 4.6 as supplemented by the terms set out in Schedule
10. The provisions of Clauses 22.1 and 22.3 shall apply,
mutatis mutandis, in relation to payments to be made by each
Bank to the Issuing Banks pursuant to this Clause 4.6.
4.6.4 The Indemnifiers and the Guarantors hereby agree and
acknowledge that, to the extent that any Bank makes any
payment to any Issuing Bank pursuant to this Clause 4.6,
that Bank will thereupon be subrogated to any rights such
Issuing Bank may then have against each of the Obligors in
respect of the amount so paid by that Bank to such Issuing
Bank, and the Indemnifiers will indemnify such Bank in
respect of the amount so paid by that Bank. The Indemnifiers
shall also indemnify that Bank against all costs and
expenses incurred by that Bank in recovering or attempting
to recover any amount pursuant to its rights of subrogation
referred to above.
4.7 Issuing Banks' Position Notwithstanding that each Issuing Bank acts as
principal and not as agent in issuing and agreeing to issue any Bank
Guarantee under this Agreement, to the extent not inconsistent
therewith the provisions of Clause 14 excluding or restricting
liability and responsibility shall apply mutatis mutandis for the
benefit of each Issuing Bank in its relations with the Banks.
4.8 Change of Issuing Bank
4.8.1 The Agent may designate any Bank which consents to act as a
replacement or additional Issuing Bank, but not with respect
to a Bank Guarantee already issued.
4.8.2 Any Issuing Bank may resign at any time on giving not less
than one month's prior written notice (or in the case of
illegality immediately on giving notice) to the Agent and
the Indemnifiers if (i) an Instructing Group consents; or
(ii) it is unlawful or impracticable for such Issuing Bank
to continue as an Issuing Bank; or (iii) it has reasonable
grounds for wishing to resign going beyond dissatisfaction
with the amount of work involved and/or the fees receivable;
or (iv) it ceases to have a Commitment under this Agreement.
4.8.3 If all the Issuing Banks so resign and no replacement is so
appointed, any Bank Guarantee to be issued will be issued by
the Agent on behalf of the Banks severally in their
Proportionate Shares, and in such an event the Agent will be
considered an Issuing Bank and will have all the rights,
powers, discretions and remedies of an Issuing Bank under
this Agreement.
-27-
5 REDUCTION
5.1 Voluntary Reductions The Commitments may be reduced in whole or in
part but in no event to less than the Bank Guarantee Outstandings in a
minimum amount of $5,000,000 or, if higher, in integral multiples of
$500,000, on not fewer than three Business Days' prior written notice
to the Agent from the Obligors' Agent of such reduction. Any such
notice shall be irrevocable and each such reduction in the Commitments
may not be reversed.
5.2 Facility Amount The Facility Amount shall be reduced from time to time
by the amount of each Bank Guarantee issued. The Facility Amount shall
be increased each time during the Facility Availability Period by the
amount of any issued Bank Guarantee in respect of which there are no
longer any Bank Guarantee Outstandings.
5.3 Excess Advances The Agent will value the Bank Guarantee Outstandings
on a quarterly basis (or at such time when requested to do so by an
Issuing Bank) and if at such time the aggregate amount of the Bank
Guarantee Outstandings exceeds the aggregate of the Commitments, the
Obligors' Agent shall immediately pay or cause to be paid to the Agent
cash in an amount equal to the difference between the Bank Guarantee
Outstandings and the aggregate of the Commitments. Such amount shall
be held by the Agent as additional security for the Obligations. Any
amount paid to the Agent in accordance with this Clause 5.3 shall be
aggregated with the amounts paid by the Obligors' Agent in accordance
with Clause 8 and the provisions of Clause 8 shall apply to such
amount.
6 CONDITIONS PRECEDENT AND SUBSEQUENT
6.1 Conditions Precedent - First Bank Guarantee Before any Issuing Bank
shall have any obligation to issue the first Bank Guarantee under the
Facility, the Obligors' Agent and the Indemnifiers shall deliver or
cause to be delivered to, or to the order of, the Agent the following
documents and evidence:
6.1.1 Evidence of incorporation Such evidence as the Agent may
reasonably require that each Obligor that is a member of the
SO Group was duly incorporated in its country of
incorporation and remains in existence and, where
appropriate, in good standing, with power to enter into, and
perform its obligations under, those of the Facility
Documents to which it is, or is intended to be, a party,
including a copy, certified by a director or an officer of
such Obligor as true, complete, accurate and unamended, of
all documents establishing or limiting the constitution of
such Obligor.
6.1.2 Corporate authorities A copy, certified by a director or the
secretary of each Obligor that is a member of the SO Group
as true, complete, accurate and neither amended nor revoked,
of a resolution of the directors and (where required by the
laws of the country of incorporation or the constitutional
documents of the relevant Obligor) a resolution of the
shareholders of such Obligor (together, where required by
laws of the country of incorporation or its constitutional
documents, with signed waivers of notice of any directors'
or shareholders' meetings) approving and authorising or
ratifying the execution of those of the Facility Documents
to which such Obligor is or is intended to be a party and
the
-28-
performance of the transactions contemplated thereby and all
matters incidental thereto, and in respect of each company
incorporated under the laws of Scotland whose shares are
being pledged, a resolution of the directors and a
resolution of the shareholders of each such company,
approving appropriate changes to the articles of association
of such company as requested by the Security Trustee, the
transfer of the relevant shares to the Security Trustee or
its nominee, instructing the updating of statutory registers
of such company and approving where appropriate the issue of
a further share certificate or certificates.
6.1.3 Officer's certificate A certificate (i) signed by a duly
authorised officer of each of the Obligors that is a member
of the SO Group setting out the names of the directors,
officers and (except for XXXX) shareholders of that Obligor
and (ii) issued by company registry of each Obligor that is
a member of the SO Group confirming due incorporation and
valid existence and (when such information is maintained by
the registry) the names of its directors and shareholders.
6.1.4 Power of attorney The power of attorney (notarially attested
and legalised, if necessary, for registration purposes) of
each of the Obligors that is a member of the SO Group under
which any Facility Documents are to be executed or
transactions undertaken by an attorney on behalf of that
Obligor.
6.1.5 The Facility Documents All of the Facility Documents set
forth in Part A of Schedule 4, except for such Share Pledges
as the Agent upon request of the Obligors' Agent agrees may
be delivered pursuant to Clause 6.2.
6.1.6 Process agent A letter from Xxxxx Offshore M.S. Limited
accepting its appointment by each of the Obligors as agent
for service of Proceedings pursuant to the Facility
Documents.
6.1.7 Legal opinions Confirmation that all legal opinions required
by the Agent on behalf of the Banks have been or will be
given substantially in the form required by the Agent on
behalf of the Banks.
6.1.8 Accounts The unaudited consolidated accounts of the SO Group
for its financial year ended 30 November 2003, certified
that they fairly and reasonably represent the financial
condition of the SO Group to the best of the knowledge,
information and belief of the chief financial officer of
XXXX.
6.1.9 Corporate Structure A current structure chart evidencing the
corporate structure of the SO Group, including jurisdiction
of organisation, capitalisation and outstanding
shareholdings.
6.1.10 Further Assurance Such other documents and evidence as the
Agent may reasonably require in relation to the
authorisation, execution, delivery and registration of the
Facility Documents and the perfection of the security
provided thereby.
-29-
6.1.11 Funding of Lock Box One and Lock Box Two Evidence that
$20,000,000 has been transferred to Lock Box One and that
the balance of excess cash over $75,000,000 has been
transferred to Lock Box Two.
6.1.12 Fees and Expenses Evidence that the fees and invoiced costs
and expenses respectively due pursuant to Clauses 12 and
24.2 have been paid.
6.1.13 Risk Management Systems of the SO Group Evidence that XXXX
has instructed KPMG to prepare for XXXX and the Finance
Parties a report on the recently adopted risk management
systems of the SO Group.
6.1.14 SNSA/SNTG Undertakings Letter XXXX will have requested in
writing a letter from SNSA and SNTG on behalf of each
shipowning entity that is a Subsidiary of SNSA or SNTG, but
not of XXXX confirming that the representations contained in
Clauses 7.17, 7.18 and 7.19 are true and correct and
undertaking that each such Subsidiary will comply with all
covenants and undertakings provided for in Clauses 15.1.1,
15.1.2, 15.1.3, 15.2.1 and 15.2.2 and in Schedule 14, as if
each such Subsidiary were a party to this Agreement.
6.1.15 Intercreditor, Override and Security Trust Deed The
Intercreditor, Override and Security Trust Deed duly
executed and delivered.
6.1.16 Existing Facilities Guarantee The Existing Facilities
Guarantee duly executed and delivered.
6.1.17 Waiver Fee Evidence that a waiver fee of $10,000 has been
paid to each of the financial institution listed in Schedule
15, being the banks under the Existing Credit Agreements.
6.1.18 Approved Budget Delivery of the consolidated budget of the
SO Group for the financial year commencing 1 December 2003
for the approval by an Instructing Group.
6.1.19 Items pursuant to Share Pledges Where appropriate, duly
executed share certificates, and (where relevant)
accompanied by duly stamped and executed stock transfer
forms, certified copies of each register of members and any
other documents required to be delivered pursuant to the
Share Pledges, except where the Agent upon the request of
the Obligors' Agent agrees that such may be delivered
pursuant to Clause 6.2.
6.1.20 Appointment of Xxx Xxxxx Evidence that Xxx Xxxxx has been
appointed to the board of directors of XXXX by the board of
directors of XXXX.
6.2 Conditions Subsequent XXXX undertakes to deliver or to cause to be
delivered to the Agent as soon as practicable and in any event no
later than 31 March 2004, unless a different time period is specified
below in which event within that time period specified, the following
additional documents and evidence:
-30-
6.2.1 Insurers' letters of undertaking Insurers' letters of
undertaking as required by the relevant Facility Documents.
6.2.2 Legal opinions Such legal opinions as the Agent on behalf of
the Banks shall require pursuant to Clause 6.1.7 to the
extent not already delivered to the Agent pursuant to that
Clause.
6.2.3 Companies Act registrations On or before 31 March 2004 (or
such later date as the Agent may agree after consultation
with an Instructing Group in respect of the Facility
Documents delivered pursuant to Clause 6.2.8), evidence that
the prescribed particulars of the Facility Documents have
been delivered to (i) the Registrar of Companies of England
and Wales and (ii) any other applicable registry, agency or
body within the statutory time limit.
6.2.4 Master's receipts The Master's receipts for the notices of
the Mortgages over the Vessels.
6.2.5 Independent Directors On or before 31 May 2004, evidence of
the appointment to the board of directors of XXXX of two
additional non-executive independent directors satisfactory
to an Instructing Group.
6.2.6 Key Staff Retention Package Evidence that the board of
directors of XXXX has approved and implemented a key staff
retention package to retain Xxxx-Xxx Xxxxx, Xxxxx Xxxxxxxxx,
Xxx Xxxxx, Xxxxx Xxxxxx and Xxxxxx Xxxxxxx, in form and
substance satisfactory to an Instructing Group.
6.2.7 Corporate Governance XXXX shall have delivered to the Agent
a plan for its governance and the operation of the SO Group
independent of SNSA and SNTG and implementation thereof
shall have commenced and scheduled to be completed no later
than 31 December 2004, which plan shall include
establishment on or before 30 September 2004 of a board of
directors and audit committee of XXXX that meets the
requirements of the National Market System of the National
Association of Securities Dealers, Inc. applicable to
foreign private issuers that are not "controlled companies"
assuming that all phase-in periods for implementing such
requirements have expired on 30 September 2004.
6.2.8 The Remaining Facility Documents On or before 31 March 2004
(or such later date as the Agent may agree after
consultation with an Instructing Group), the Facility
Documents listed in Part B, Part C and Part D of Schedule 4,
together with all notices and other documents required by
Schedule 9 for all Vessels to become Mortgaged Vessels.
6.2.9 Items pursuant to Share Pledges To the extent not delivered
pursuant to Clause 6.1.19 and where appropriate, all duly
executed share certificates, and (where relevant)
accompanied by duly stamped and executed stock transfer
forms, certified copies of each register of members and any
other documents required to be delivered pursuant to the
Share Pledges.
-31-
6.2.10 Insurance Report The report from the Insurance Adviser in
respect of the SO Group's compliance with paragraph 5 of
Schedule 14.
6.2.11 Governmental Approval and Third Party Consents Evidence that
(a) the form of Share Pledge in respect of Class 3 Shipping
Limited has been pre-approved by the Bermuda Monetary
Authority and (b) on or before 31 March 2004 (or such later
date as the Agent may agree after consultation with an
Instructing Group in respect of the Facility Documents
delivered pursuant to Clause 6.2.8), evidence that all other
governmental and third party approvals and consents which
are necessary for the execution, delivery and performance of
the Facility Documents and the consummation of the
transactions contemplated thereby, have been obtained.
6.2.12 Valuations A valuation for each Vessel owned by a member of
the SO Group conducted by an Approved Shipbroker appointed
by the Obligors' Agent dated no earlier than 31 December
2003 addressed to a member of the SO Group.
6.2.13 XXXX'x Extract On or before 22 March 2004, extract from the
commercial registrar of companies for XXXX.
6.2.14 Approval of Xxx Xxxxx'x appointment On or before 31 May
2004, evidence that Xxx Xxxxx has been elected to the board
of directors of XXXX by the shareholders of XXXX or that his
appointment to the board of directors of XXXX has been
approved by the shareholders of XXXX.
6.3 Conditions Precedent - All Bank Guarantees Before an Issuing Bank
shall issue any Bank Guarantee (including the first Bank Guarantee):
6.3.1 until (i) the Equity Contribution shall have occurred and
(ii) the SNSA Guarantee shall have been duly executed and
delivered, the Cash Collateral shall not be less than 100%
of the Bank Guarantee Outstandings at such time after giving
effect to the issuance of all Bank Guarantees for which an
Issue Request has been received by the Agent and is no
longer pending;
6.3.2 after (i) the Equity Contribution shall have occurred and
(ii) the SNSA Guarantee shall have been duly executed and
delivered:
(a) the Value of Qualifying Collateral shall not be less
than 100% of the Bank Guarantee Outstandings at such
time after giving effect to the issuance of all Bank
Guarantees for which an Issue Request has been received
by the Agent,
(b) the Cash Collateral shall be not less than 50% of the
Bank Guarantee Outstandings at such time after giving
effect to the issuance of all Bank Guarantees for which
an Issue Request has been received by the Agent; and
(c) the Value of Qualifying Vessel Collateral shall be not
less than 120% of the difference between (i) the Bank
Guarantee Outstandings at such time after giving effect
to the issuance of all
-32-
Bank Guarantees for which an Issue Request has been
received by the Agent and (ii) the Cash Collateral at
such time.
6.3.3 no Default shall have occurred and be continuing at the date
of the Issue Request or at the Issue Date;
6.3.4 no Default will result from the issue of the Bank Guarantee
in question; and
6.3.5
(a) in respect of the first Bank Guarantee, all
representations and warranties contained in Clause 7;
and
(b) in respect of any other Bank Guarantee, all Repeating
Representations,
shall be true and correct on both the date of the Issue
Request and the date that the Bank Guarantee is issued.
6.4 No waiver If an Instructing Group agrees to the issuance of any Bank
Guarantee before all of the documents and evidence required by Clause
6.1 have been delivered to or to the order of the Agent, the Obligors'
Agent and the relevant Obligor undertake to deliver all outstanding
documents and evidence to or to the order of the Agent no later than
the date specified by the Agent, and the issue of any Bank Guarantee
shall not be taken as a waiver of the Agent's right to require
production of all the documents and evidence required by Clause 6.1.
6.5 Form and content All documents and evidence delivered to the Agent
pursuant to this Clause 6 shall:
6.5.1 be in form and substance acceptable to the Agent;
6.5.2 be accompanied, if required by the Agent, by translations
into the English language, certified in a manner acceptable
to the Agent; and
6.5.3 if required for registration purposes, be certified,
notarised, legalised or attested in a manner acceptable to
the Agent.
7 REPRESENTATIONS AND WARRANTIES
Each of the Indemnifiers and each of the Guarantors represents and warrants to
each of the Finance Parties at the date of this Agreement, and in case of the
Repeating Representations (by reference to the facts and circumstances then
pertaining) at the date of each Issue Request and at each Issue Date, as to it
and its Subsidiaries follows:
7.1 Incorporation and capacity Each of the Obligors is a body corporate
duly constituted, organised and validly existing and (where
applicable) in good standing under the law of its country of
incorporation, in each case with perpetual corporate existence, or in
respect of XXXX or any Obligor incorporated under the laws of
Luxembourg, with corporate existence for an unlimited period, and the
power to xxx and be sued, to own its assets and to carry on its
business.
-33-
7.2 Insolvency None of the Obligors (a) is insolvent or in liquidation or
administration or subject to any other insolvency proceedings, and no
receiver, administrative receiver, administrator, liquidator, trustee
or analogous officer has been appointed in respect of any of the
Obligors or all or any part of their assets, (b) has commenced
negotiations with any one or more of its creditors with a view to the
general readjustment or rescheduling of its indebtedness. For this
purpose a Obligor will be deemed insolvent if it is unable to pay its
debts within the meaning of section 123 of the Insolvency Xxx 0000.
7.3 Binding obligations The Facility Documents when duly executed and
delivered will constitute the legal, valid and binding obligations of
the Obligors enforceable in accordance with their respective terms
subject to applicable laws regarding creditors' rights in general
subject to reservations expressed in the legal opinions received by
the Agent in accordance with Clause 6.1.7 or 6.2.2.
7.4 Satisfaction of conditions Each Obligor has power to enter into,
perform and deliver and has taken all necessary action to authorise
its entry into, performance and delivery of the Facility Documents to
which it is a party and the transactions contemplated therein. All
acts, conditions and things required to be done and satisfied and to
have happened prior to the execution and delivery of the Facility
Documents in order to constitute the Facility Documents as the legal,
valid and binding obligations of the Obligors in accordance with their
respective terms and to make the Facility Documents admissible in
evidence in the appropriate courts have been done, satisfied and have
happened in compliance with all applicable laws.
7.5 Registrations and consents With the exception only of the
registrations referred to in Clause 6.2.3, all (if any) consents,
licences, approvals and authorisations of, or registrations with or
declarations to, any governmental authority, bureau or agency which
may be required in connection with the execution, delivery,
performance, validity or enforceability of the Facility Documents have
been obtained or made and remain in full force and effect and neither
any Indemnifier nor any Guarantor is aware of any event or
circumstance which could reasonably be expected adversely to affect
the right of any of the Obligors (as the case may be) to hold and/or
obtain renewal of any such consents, licences, approvals or
authorisations.
7.6 Disclosure of material facts Neither any Indemnifier, nor any
Guarantor is aware of any material facts or circumstances which have
not been disclosed to the Agent and which might, if disclosed, have
reasonably been expected to adversely affect the decision of a person
considering whether or not to make guarantee facilities of the nature
contemplated by this Agreement available to the Indemnifiers.
7.7 No material litigation Except for those matters listed in Schedule 11,
there is no action, suit, arbitration or administrative proceeding nor
any contemplated action, suit, arbitration or administrative
proceeding pending or to its knowledge about to be pursued before any
court, tribunal or governmental or other authority which would or
would be reasonably likely to, if adversely determined, have a
Material Adverse Effect.
7.8 No breach of law or contract The execution, delivery and performance
of the Facility Documents will not contravene any contractual
restriction or any law binding on any of the Obligors or the
constitutional documents of any of the Obligors, or, in
-34-
relation to the Share Pledges, any of the SO Group companies whose
shares are being pledged, nor result in the creation of, nor oblige
any of the Obligors to create, any Encumbrance over all or any of its
assets, with the exception of the Encumbrances created by or pursuant
to the Facility Documents.
7.9 No deductions Except as disclosed to the Agent in writing, to the best
of their knowledge and belief and without undue enquiry, none of the
Obligors is required to make any deduction or withholding from any
payment which it may be obliged to make to any of the Finance Parties
under or pursuant to the Facility Documents.
7.10 Subsidiaries Save as a result of any merger or amalgamation effected
pursuant to Clause 15.1.4, the Senior Shipowning Guarantors and the
relevant Junior Shipowning Guarantors are and will remain throughout
the Facility Period directly or indirectly wholly owned subsidiaries
of XXXX.
7.11 Material adverse change There has been no material adverse change in
any of the business, condition (financial or otherwise), operations,
performance, properties or prospects of the SO Group (taken as a
whole) from that pertaining at 30 November 2003.
7.12 XXXX'x company status XXXX operates as a financial holding company
under Luxembourg law pursuant to the terms of a letter of the
"Administration de l'Enregistrement et des Domaines" dated 9 September
1994.
7.13 Encumbrances Save for Permitted Liens, no Encumbrance exists over (i)
all or any of the present or future revenues or assets of any member
of the SO Group or (ii) any Vessel or its Earnings, Insurances or
Requisition Compensation nor any part thereof owned by any entity
which is not a member of the SO Group.
7.14 Good Title to Assets XXXX and each Subsidiary of XXXX has good, valid
and marketable title to, or valid leases or licences of, and all
appropriate authorisations, consents, approvals, registrations,
filings or similar requirements to use, the assets necessary to carry
on its business as presently conducted save in so far as any failure
to have a good, valid and marketable title would not reasonably be
expected to have a Material Adverse Effect.
7.15 Taxation
7.15.1 Each Obligor has duly and punctually paid and discharged or
caused to be paid and discharged all Taxes, assessments and
governmental charges imposed upon it or its assets within
the time period allowed therefor without imposing tax
penalties or creating any Encumbrance with priority to the
Banks or to the security granted or evidenced by the
Facility Documents (save to the extent that such Taxes,
assessments and governmental charges are not material or are
being contested in good faith and adequate reserves are
being maintained for those Taxes and where payment thereof
would not result in an Encumbrance with priority to the
Banks or to the security created or evidenced by the
Facility Documents or would not be likely to have a Material
Adverse Effect).
-35-
7.15.2 No Obligor is overdue in the filing of any tax returns where
failure to file could reasonably be expected to have a
Material Adverse Effect.
7.15.3 No claims are being or, to the best of the knowledge and
belief of each Obligor, are reasonably likely to be asserted
against any Obligor with respect to Taxes which could
reasonably be expected to have a Material Adverse Effect.
7.15.4 No Obligor has any material unindemnified Tax liabilities
which have not been, but should have been, recorded in its
statutory accounts.
7.15.5 Giving effect to all extensions requested and received, the
Obligors on a timely basis have properly filed or caused to
be filed (and, where applicable, have been included in) all
material US Tax returns, reports and statements (whether
federal, provincial, state, local or otherwise) applicable
to them in all jurisdictions in which such returns, reports
and statements are required to be filed (save to the extent
that failure to comply with the obligations under this
Clause 7.15.5 would not be likely to have a Material Adverse
Effect). All such US Tax returns are correct and complete in
all material respects.
7.15.6 Giving effect to all extensions requested and received, the
Obligors on a timely basis have paid or caused to be paid
all material US Taxes due whether or not shown on any tax
return, together with applicable interest and penalties,
except to the extent such US Taxes are contested in good
faith and with respect to which adequate reserves have been
set aside for the payment thereof.
7.16 Information
7.16.1 The Information Package (other than forecasts and
projections therein) was true, complete and accurate in all
material respects as at the date such information was
supplied and is not misleading in any material respect and
the group structure chart provided in accordance with Clause
6.1.9 accurately reflects the shareholdings of the SO Group.
7.16.2 All forecasts and projections in the Information Package
supplied by or on behalf of any Indemnifier or any Guarantor
to the Agent, the Banks and/or their advisers were prepared
in good faith and based on opinions and assumptions which
its respective directors believe were reasonable to hold and
reasonable to make at the time of such supply.
7.16.3 Neither any Indemnifier, nor any Guarantor has failed to
disclose to the Agent any facts or circumstances which would
be reasonably likely to render any of the information
referred to in Clause 7.16.1 or 7.16.2 untrue or misleading
in any material respect.
7.17 The Vessels The Vessels are:
(a) in the absolute ownership of the Shipowning Guarantors who will
on and after the Execution Date be the sole, legal and beneficial
owner of the Vessels;
-36-
(b) each registered in the name of a Shipowning Guarantor under the
laws and flag of the countries specified in Schedules 2 and 3;
(c) save as disclosed to, and agreed by, the Agent in writing prior
to the Execution Date, operationally seaworthy and in every way
fit for service; and
(d) except for M.V. Seaway Invincible which is currently not classed,
DLB1 and M.V. American Independence which are not required to be
classed in order to operate properly such Vessels, and with
respect to any of American Star, American Triumph, American
Victory, American Liberty or American Diver, if demonstrated to
the satisfaction of the Agent acting reasonably as not requiring
to be classed in order to properly operate such Vessel, for any
of such Vessels, classed with the highest applicable class
necessary to properly operate the Vessels of Lloyd's Register of
Shipping, Det Norske Veritas, American Bureau of Shipping,
Isthmus Maritime Classification S.A., Bureau Veritas; free of all
requirements and overdue recommendations of such classification
societies.
7.18 Vessels' employment Save as notified to and approved by the Agent
before the Execution Date, the Vessels are not and will not on or
before the Effective Date be subject to any charter or contract or to
any agreement to enter into any charter or contract which, if entered
into after the Execution Date would have required the consent of an
Instructing Group and on or before the Effective Date there will not
be any agreement or arrangement whereby the Earnings of any of the
Vessels may be shared with any other person.
7.19 Environmental matters To the best of the knowledge and belief of the
Indemnifiers and the Guarantors and their officers:
(a) all Environmental Laws applicable to the Vessels have been
complied with in all material respects and all material consents,
licences and approvals required under such Environmental Laws
have been obtained and complied with in all material respects
other than those which would not reasonably be expected to have a
Material Adverse Effect; and
(b) no Environmental Claim has been made or threatened or is pending
against any member of the SO Group or any Vessel and not fully
satisfied which could reasonably be expected to have a Material
Adverse Effect; and
(c) there has been no Environmental Incident which could reasonably
be expected to have a Material Adverse Effect.
7.20 No Workers Council There exists no workers council for any Dutch
Obligor.
8 CURRENCY
8.1 Currency Fluctuations
(a) If as a result of fluctuations in currency exchange rates the
Agent shall determine that the Bank Guarantee Outstandings exceed
the Commitments, the Obligors' Agent shall immediately pay or
cause to be paid to the Agent on
-37-
behalf of the Banks an amount in Dollars equal to the amount of
such difference.
(b) If as a result of fluctuations in currency exchange rates the
Agent shall determine that the Bank Guarantee Outstandings are
less than 95% of the Commitments, the Agent shall at the request
of the Obligors' Agent reimburse any amounts paid by the
Obligors' Agent in accordance with paragraph (a) above.
(c) All amounts paid in respect of the Bank Guarantee Outstandings by
the Obligors' Agent in accordance with paragraph (a) above shall
be held by the Agent as additional security for the Obligations.
(d) The determination by the Agent referred to in Clause 8.1 shall be
made on a quarterly basis (or at such time when requested to do
so by an Issuing Bank).
9 FUNDING AND CASH COVER
9.1 Funding and cash cover The Obligors' Agent undertakes (i) until the
date on which the Equity Contribution shall have occurred and the SNSA
Guarantee shall have been duly executed and delivered, (ii) after the
occurrence and during the continuation of an Event of Default, (iii)
if the SNSA Guarantee is revoked or repudiated by SNSA or SNTG, or is
not or ceases to be in full force and effect other than as
contemplated by the SNSA Guarantee, or (iv) with respect to a
particular Bank Guarantee after the Bank Guarantee Termination Date of
such Bank Guarantee if under applicable law the relevant Bank
Guarantee nevertheless remains outstanding until the subject Bank
Guarantee instrument is surrendered, to pay or cause the relevant
Indemnifier to pay to the Agent or to its order (including to deposit
the same in Lock Box One) on demand the amount specified in that
demand (in the currency so specified):
(a) to give the Agent cash cover for the amount of the Banks'
Obligations (or in the case of clause (iv) above, those in
respect of the relevant Bank Guarantee); and/or
(b) to put the Agent in funds to make a payment which the Agent
and/or any Issuing Bank is authorised by this Agreement to make
in connection with the Banks' Obligations (or in the case of
clause (iv) above, those in respect of the relevant Bank
Guarantee),
provided that any monies received by the Agent pursuant to this Clause
or Clause 17.1 in excess of the amount of the Banks' Obligations due
and owing at that time (the "Excess Amount") shall, if not deposited
in Lock Box One, be held by the Agent by way of retention on account
of the Obligations and/or applied in accordance with Clause 18.4. In
the case of clause (ii) above), the Agent may in its sole discretion
release the Excess Amount to the Obligors' Agent or the Indemnifier
who provided same if the relevant Event of Default has been remedied
and no other Default has occurred or is in existence at such time.
9.2 Collateralising Bank Guarantees The Obligors' Agent shall on demand of
the Agent made no earlier than 72 months after the Execution Date
fully Cash
-38-
Collateralise or cause the relevant Indemnifiers to fully Cash
Collateralise all Bank Guarantee Outstandings.
9.3 Security over funding/cash cover To the extent that cash required by
Clause 9.1 or under Clause 5.3, 8.1 or 15.2.2 or provided to the Agent
as additional security to satisfy the condition in Clause 6.3.1 or
Clause 16.1 is not deposited in Lock Box One and is not required by
the Facility Documents to be deposited therein, the Obligors' Agent
undertakes, at its own expense, to execute and cause the Indemnifiers
to execute (as soon as reasonably practicable) such further documents
as the Agent may require in order to create, perfect or evidence in
the Agent's favour a restriction on withdrawal or repayment of any
amount paid and/or a security interest in or over such amount, in each
case to secure or support the Obligations.
9.4 Currency The Agent and/or the relevant Issuing Bank may, if called on
to make a payment or to comply with a demand or claim in connection
with the Banks' Obligations, purchase in accordance with its usual
practice the amount of the Relevant Currency necessary to make that
payment or to comply with that demand or claim (unless the Agent
and/or the relevant Issuing Bank has already been put in funds
pursuant to Clause 9.1).
10 INTEREST
10.1 Default Rate If an Event of Default in respect of non-payment by any
Obligor of any amount hereunder shall occur, such amount shall, from
the date payment to the Agent is due from the relevant Obligor or
Obligors, bear interest up to the date of actual payment (both before
and after decree or judgment) at the Default Rate, compounded
quarterly, which interest shall be payable from time to time by the
Indemnifiers to the Agent on behalf of the Banks on demand.
10.2 Determinations conclusive Each determination of an interest rate made
by the Agent in accordance with Clause 10.1 shall (save in the case of
manifest error or on any question of law) be final and conclusive.
11 GUARANTEE AND INDEMNITY
11.1 The Guarantee In consideration of the agreement of the Issuing Banks
and the Banks to make the Facility available on behalf of the
Indemnifiers, each Guarantor, subject to Clause 1.3:
11.1.1 irrevocably and unconditionally guarantees, as primary
obligor and not merely as surety, to discharge on demand the
Obligations of the Indemnifier which is a Subsidiary of such
Guarantor and, to the maximum extent permitted by law, the
Obligations of each other Obligor under and in accordance
with the terms of the Facility Documents, including payment
of Interest thereon from the date of demand until the date
of payment, both before and after decree or judgment; and
11.1.2 agrees, as a separate and independent obligation, that, if
any of the Obligations of the Indemnifier or any other
Obligor is not recoverable from the other Guarantors under
Clause 11.1.1 for any reason, it will be liable to the
Finance Parties as a principal debtor by way of indemnity
for the same
-39-
amount as that for which it would have been liable had those
obligations been recoverable and agrees to discharge its
liability under this Clause 11.1.2 on demand together with
payment of Interest thereon from the date of demand until
the date of payment, both before and after decree or
judgement, provided that there shall be no double-counting
of Interest occurring in respect to the Obligations under
this Clause 11.1.
11.2 Continuing Security The Guarantee is a continuing security for the
full amount payable by the Obligors or any of them under the Facility
Documents from time to time and shall remain in force notwithstanding
the liquidation of any Obligor or any change in the constitution of
any Obligor or of any Finance Party or the absorption of or
amalgamation by any Finance Party in or with any other entity or the
acquisition of all or any part of the assets or undertaking of any
Finance Party by any other entity. The Guarantee constitutes a
guarantee of payment and not of collection.
11.3 Preservation of Guarantors' Liability
11.3.1 The Agent may without a Guarantor's consent and without
notice to such Guarantor and without in any way releasing or
reducing the Obligations of the Guarantors:
(a) amend, novate, supplement or replace all or any of the
Facility Documents to which such Guarantor is not a
party;
(b) increase or reduce the amount of the Facility or vary
the terms and conditions for the issuance of the Bank
Guarantees (including, the rate and/or method of
calculation of interest or commission payable on the
Facility);
(c) allow to the Indemnifiers, any other Obligor or other
person any time or other indulgence;
(d) renew, vary, release or refrain from enforcing any of
the Facility Documents or any other security, guarantee
or indemnity which the Agent may now or in the future
hold from the Indemnifiers or from any other person;
(e) compound or make any other arrangements with the
Indemnifiers or any other Obligor or other person;
(f) enter into, renew, vary or terminate any other
agreement or arrangement with the Indemnifiers or any
other Obligor or other person; or
(g) make any concession to the Indemnifiers or other
Obligor or do or omit or neglect to do anything which
might, but for this provision, operate to discharge,
release or reduce the liability of the Guarantors under
the Guarantee.
-40-
11.3.2 The liability of the Guarantors under the Guarantee shall
not be affected by:
(a) the absence of or any defective, excessive or irregular
exercise of any of the powers of the Indemnifiers or of
any other Obligor;
(b) any security given or payment made to the Finance
Parties or any of them by the Indemnifiers or any other
person being avoided or reduced under any law (whether
English or foreign) relating to bankruptcy or
insolvency or analogous circumstance in force from time
to time;
(c) the liquidation, administration, receivership or
insolvency of any Obligor;
(d) any other security, guarantee or indemnity now or in
the future held by the Finance Parties or any of them
being defective, void or unenforceable, or the failure
of any Finance Party to take any security, guarantee or
indemnity;
(e) any compromise or arrangement under Part I of the
Insolvency Xxx 0000 or section 425 of the Companies Xxx
0000 (or any statutory modification or re-enactment of
either of them for the time being in force) or under
any analogous provision of any foreign law;
(f) the novation of any of the Obligations; or
(g) anything which would not have discharged, released or
reduced the liability of any Guarantor to the Finance
Parties had the liability of such Guarantor under
Clause 11.1.1 been as a principal debtor of the Finance
Parties and not as a guarantor.
11.4 Preservation of Banks' Rights
11.4.1 The Guarantee is in addition to any other security,
guarantee or indemnity now or in the future held by the
Finance Parties in respect of the Obligations, whether from
any Indemnifier, any Guarantor or any other person, and
shall not merge with, prejudice or be prejudiced by any such
security, guarantee or indemnity or any contractual or legal
right of each Finance Party.
11.4.2 Any release, settlement, discharge or arrangement relating
to the liabilities of any Guarantor under the Guarantee
shall be conditional on no payment, assurance or security
received by the Finance Parties in respect of the
Obligations being avoided or reduced under any law (whether
English or foreign) in force from time to time relating to
bankruptcy, insolvency or any (in the opinion of the Agent)
analogous circumstance and after any such avoidance or
reduction the Finance Parties shall be entitled to exercise
all of their rights, powers, discretions and remedies under
or pursuant to the Guarantee and/or any other rights,
powers, discretions or remedies which they would otherwise
have been entitled to exercise, as if no release,
settlement, discharge or arrangement had taken place. 11.4.3
Following the discharge of the Obligations, the Finance
Parties shall be entitled to retain any security which they
may hold for the liabilities of the Guarantors under the
Guarantee until the Finance Parties are satisfied in their
reasonable discretion that they will not have to make any
payment under any law referred to in Clause 11.4.2.
-41-
11.4.3 Following the discharge of the Obligations, the Finance
Parties shall be entitled to retain any security which they
may hold for the liabilities of the Guarantors under the
Guarantee until the Finance Parties are satisfied in their
reasonable discretion that they will not have to make any
payment under any law referred to in Clause 11.4.2.
11.4.4 Until all claims of the Finance Parties in respect of the
Obligations have been discharged in full and while the Bank
Guarantees remain outstanding:
(a) the Guarantors shall not be entitled to participate in
any security held or sums received by any Finance Party
in respect of all or any part of the Obligations;
(b) the Guarantors shall not stand in the place of, or be
subrogated for, any of the Finance Parties in respect
of any security nor take any step to enforce any claim
against any Indemnifier or any Surety (or the estate or
effects of any such person) nor claim or exercise any
right of set off or counterclaim against any
Indemnifier or any Surety nor make any claim in the
bankruptcy or liquidation of any Indemnifier or any
Surety in respect of any sums paid by any Guarantor to
the Finance Parties or any of them or in respect of any
sum which includes the proceeds of realisation of any
security at any time held by the Finance Parties or any
of them in respect of all or any part of the
Obligations of the Guarantors pursuant to the
Guarantee; and
(c) the Guarantors shall not take any steps to enforce any
claim which it may have against any Indemnifier or any
Obligor without the prior written consent of the Agent,
and then only on such terms and subject to such
conditions as the Agent may impose.
11.4.5 The Obligations of the Guarantors pursuant to the Guarantee
shall be continuing for all purposes (including Interest)
and every sum of money which may now or in the future be or
become due or owing to the Finance Parties by any Obligor
under the Facility Documents (or which would have become due
or owing had it not been for the bankruptcy, liquidation or
insolvency of the relevant Obligor) shall be deemed to
continue due and owing to the Finance Parties by the
relevant Obligor until such sum is actually repaid to the
Finance Parties, notwithstanding the bankruptcy, liquidation
or insolvency of the relevant Obligor.
11.4.6 The Finance Parties may, but shall not be obliged to, resort
for their own benefit to any other means of payment at any
time and in any order they think fit without releasing or
reducing the Obligations of the Guarantors pursuant to the
Guarantee.
11.4.7 The Finance Parties may enforce the Guarantee either before
or after resorting to any other means of payment or
enforcement and, in the latter case, without entitling the
Guarantors to any benefit from or share in any such other
means of payment for so long as all of the Obligations have
not been discharged in full.
-42-
11.5 Other Security Each Guarantor confirms that it has not taken and will
not take without the prior written consent of the Agent (and then only
on such terms and subject to such conditions as the Agent may impose)
any security from any Indemnifier or from any Surety in connection
with the Guarantee and that any security taken by any Guarantor in
connection with the Guarantee notwithstanding this Clause shall be
held by such Guarantor in trust for the Agent on behalf of the Finance
Parties absolutely as a continuing security for the Obligations of the
Guarantors.
11.6 Release of Guarantee The Agent will (and hereby is authorised by the
Finance Parties to) execute such documents as may be necessary to
discharge and release the Guarantee at the end of the Facility Period.
12 FEES
12.1 Bank Guarantee Commission
(a) The Indemnifier for whose benefit each Bank Guarantee has been
issued shall pay or cause to be paid to the Agent (for the
account of each Bank) a Bank Guarantee Commission calculated at
the Applicable Commission Rate on the amount of Bank Guarantee
Outstandings with respect to each such Bank Guarantee in each
case for the period during which such Bank Guarantee is
outstanding.
(b) The aggregate Bank Guarantee Commission will accrue from day to
day on the basis of a 360 day year and the actual number of days
elapsed and shall be paid quarterly in arrears. The first payment
shall be due on 31 March 2004 and a final pro rata payment shall
be due on the last day of the Facility Period. The Bank Guarantee
Commission with respect to each Bank Guarantee shall be
distributed according to each Bank's Proportionate Share with
respect to such Bank Guarantee.
12.2 Commitment Commission
(a) The Obligors' Agent shall pay to the Agent (for the account of
each Bank) a Commitment Commission calculated from the Execution
Date until the Facility Availability Termination Date at the
Applicable Commitment Rate on the daily unutilised portion of the
Facility available for Bank Guarantees to be issued, assuming and
whether or not the case that all applicable conditions in Clause
6 have been satisfied from the Execution Date.
(b) The Commitment Commission will accrue from day to day on the
basis of a 360 day year and the actual number of days elapsed and
shall be paid quarterly in arrears. The first payment shall be
due on 31 March 2004 and a final pro rata payment shall be due on
the Facility Availability Termination Date.
12.3 Fronting Fee The Indemnifier for whose benefit a Bank Guarantee has
been issued shall pay or cause to be paid quarterly in arrears to the
Agent a fronting fee equal to 0.25% per annum of the amount for which
each Bank Guarantee is issued, for the sole account of the relevant
Issuing Bank. The first payment shall be due on 31 March 2004 and a
final pro rata payment shall be due on the last day of the Facility
Period.
-43-
12.4 Issuing Fee The Indemnifier for whose benefit a Bank Guarantee has
been issued shall pay or cause to be paid on the Issue Date of each
Bank Guarantee an issue fee of $1,500 in respect of each Bank
Guarantee payable to the Agent for the account of the Issuing Bank
that issues such Bank Guarantee.
12.5 Arrangement, Agency and Security Trustee Fees The Obligors' Agent
shall pay to the Agent for its own account arrangement, agency and
security trustee fees and fees to the Security Trustee in the amounts
and at the times agreed in the letter agreement dated on or about the
date hereof between the Agent and the Obligors' Agent.
12.6 Front End Fee The Obligors' Agent shall pay to the Agent within two
Business Days from the date on which the Intercreditor, Override and
Security Trust Deed has been executed by each of the parties thereto,
for the account of the Banks, a front end fee of 1% on the amount of
the total Commitments, such fee to be payable by the Agent to each
Bank pro rata to the size of each such Bank's Commitment.
12.7 Payments in Dollars All fees provided for in this Clause 12 shall be
payable in Dollars.
12.8 Invoices to the Obligors' Agent All invoices in respect of the fees
set forth in this Clause 12 or Clause 24.2 to the Obligors' Agent
shall be addressed by the Agent to and payable by the Obligors' Agent.
13 FACILITY DOCUMENTS
13.1 Security As security for the repayment of the Obligations, the
Indemnifiers and/or the Guarantors shall procure that the Facility
Documents identified in Schedule 4 and all notices and other documents
to be given or entered into pursuant thereto as referred to therein
are executed and delivered to the Agent on or before the Effective
Date in the agreed form to the extent required by Clauses 6.1 and 6.3
and in any event for the balance thereof within the time period
provided in Clause 6.2.
13.2 Additional Security XXXX shall, and shall procure that each applicable
member of the SO Group shall:
13.2.1 if it is a Principal Subsidiary; or
13.2.2 if it acquires any vessel which would not be immediately and
effectively charged by the then existing Facility Documents
and which is deemed by an Instructing Group (acting
reasonably) to be of material value, or material to the
operation of the business of any member of the SO Group or
to the value of any other asset over which the Banks have
security,
execute and deliver to the Agent such further or additional Facility
Documents in such form (but on terms not more onerous than any
existing Facility Documents) and in relation to such vessels as an
Instructing Group may reasonably require, subject, in each case, to
any provisions of law prohibiting such entity from entering into such
Facility Documents.
-44-
13.3 Upon the occurrence of a Default (which has not been remedied) XXXX
shall procure that any and each Obligor, if so required by an
Instructing Group, shall execute and deliver to the Agent such further
or additional Facility Documents in such form and in relation to such
of its assets as an Instructing Group shall require, subject in each
case to any provisions of law prohibiting such entity from entering
into such Facility Documents.
13.4 Where such prohibition as is referred to above exists, XXXX shall
procure that the Obligors that are members of the SO Group use their
reasonable endeavours lawfully to overcome the prohibition, and the
Agent may (but shall not be obliged to) agree with the relevant member
of the SO Group limitations on the extent of the security granted by
it to the extent that in its opinion, based on the advice of
independent legal counsel acceptable to the Agent (the cost of which
shall be for the account of XXXX), it is necessary to do so in order
to overcome the prohibition.
13.5 XXXX shall procure that each Obligor shall and shall procure that each
other relevant member of the SO Group which is its Subsidiary shall,
at such Obligor's own expense execute and do all such assurances, acts
and things as the Agent may reasonably require for perfecting or
protecting the security intended to be afforded by the Facility
Documents or, if the Facility Documents have then become enforceable,
for facilitating the realisation of all or any part of the assets
which are subject to the Facility Documents and the exercise of all
powers, authorities and discretions vested in the Agent or in any
receiver of all or any part of those assets and in particular shall
execute all transfers, conveyances, assignments, assignations and
releases of that property whether to the Agent or to its nominees and
give all notices, orders and discretions which the Agent may
reasonably think expedient.
13.6 On each date that a Facility Document is entered into, the Obligors'
Agent and XXXX shall procure that certified copies of each of the
documents listed in Clauses 6.1.1, 6.1.2, 6.1.3 and 6.1.4 and (where
relevant) duly executed share certificates, duly stamped and executed
stock transfer forms, certified copies of share registers, title
documents and any necessary documents relating to assets charged are
delivered in respect of the member of the SO Group entering into such
Facility Document in form and substance reasonably satisfactory to the
Agent and legal opinions addressed to the Agent, the Issuing Banks and
the Banks from legal advisers acceptable to the Agent in the
jurisdictions in which the relevant member of the SO Group is
incorporated and in which the assets charged are situated.
13.7 Release of Security Upon the request of the Obligors' Agent and the
relevant Obligor and as long as no Default has occurred and is
continuing or would result from giving effect to such request
(provided that such request is not required in the case of Clause
13.7.4(i)):
13.7.1 Post Covenant Release Date after the Covenant Release Date
the Agent will discharge and release, or will instruct the
Security Trustee to discharge and release, all Encumbrances
granted in accordance with this Agreement in favour of the
Security Trustee;
13.7.2 Post Facility Availability Termination Date after the
Facility Availability Termination Date, upon the request of
the Obligors' Agent the Agent will instruct the Security
Trustee to discharge and release any
-45-
security represented by the Mortgaged XXXX Vessels to the
extent the Value of Qualifying Vessel Collateral exceeds the
value requirements set out in Clause 15.4 and the Value of
Qualifying Vessel Collateral after giving effect to such
discharge and release continues to equal or exceed such
requirements;
13.7.3 In connection with Disclosed Permitted Disposals at any time
the Agent will discharge and release, or will instruct the
Security Trustee to discharge and release, any Encumbrance
in connection with the Mortgaged XXXX Vessels to allow the
Disclosed Permitted Disposal of such Mortgaged XXXX Vessel
against deposit of the Net Disposal Proceeds, if any, in
Lock Box One, as required by Clause 15.2.18; and
13.7.4 In connection with the SNSA Guarantee and the SNTG Vessels
after XXXX has achieved a Consolidated Tangible Net Worth of
at least $300,000,000 as reflected in financial statements
for two consecutive fiscal quarters that are included in
filings or submissions on Forms 6-K with the United States
Securities and Exchange Commission and any interim monthly
financial statements covering the two months ending between
the quarterly balance sheet dates provided to the Agent
pursuant to this Agreement (i) the Obligations of SNSA and
SNTG under the SNSA Guarantee shall (provided no Default is
outstanding) be automatically released without further
documentation or action and (ii) the Agent will discharge
and release all Encumbrances granted by SNTG or any of its
Subsidiaries in connection with the Mortgaged Vessels to
secure the Obligations.
The Obligors' Agent and the relevant Obligors shall be responsible for
all costs in connection with any discharge and release of Encumbrances
pursuant to this Clause 13.7. The Agent will execute and do, or will
instruct the Security Trustee to execute and do, all such deeds, acts
and things as may be necessary to discharge and release the Mortgaged
Vessels from the Encumbrances constituted by the relevant Facility
Documents and in accordance with the relevant provisions (if any) of
such Facility Documents.
14 AGENCY AND TRUST
14.1 Appointment Each of the Finance Parties irrevocably appoints the Agent
as its agent for the purpose of administering the Facility and the
Facility Documents and authorises the Agent and its directors,
officers, employees and agents on such Bank's behalf acting on the
instructions from time to time of an Instructing Group and subject to
Clauses 14.4 and 14.20, to execute the Facility Documents and to
exercise all rights, powers, discretions and remedies vested in the
Finance Parties under or pursuant to the Facility Documents, together
with all powers reasonably incidental to them.
14.2 Authority Subject to Clause 14.4, each of the Banks irrevocably
authorises the Agent, acting on the instructions from time to time of
an Instructing Group:
14.2.1 to give or withhold any waivers, consents or approvals,
-46-
14.2.2 to amend or vary the terms,
14.2.3 to exercise, or refrain from exercising, any discretions,
and
14.2.4 to collect, receive, release or pay any money
of, under or pursuant to any of the Facility Documents. The Agent
shall have no duties or responsibilities as agent or as security
trustee other than those expressly conferred on it by the Facility
Documents and shall not be obliged to act on any instructions if to do
so would, in the opinion of the Agent, be contrary to any provision of
the Facility Documents or to any law, or would expose the Agent to any
actual or potential liability to any third party.
14.3 Trust The Agent agrees and declares, and each of the Banks
acknowledges, that, subject to the terms and conditions of this Clause
14.3, the Agent holds the Trust Property on trust for the Banks, in
accordance with their respective Proportionate Shares, and for the
other Finance Parties absolutely. Each of the Finance Parties agrees
that the obligations, rights and benefits vested in the Agent in its
capacity as security trustee shall be performed and exercised in
accordance with this Clause 14.3. The Agent in its capacity a security
trustee shall have the benefit of all of the provisions of this
Agreement benefiting the Agent in its capacity as agent for the
Finance Parties, and all the powers and discretions conferred on
trustees by the Trustee Xxx 0000 (to the extent not inconsistent with
this Agreement). In addition:
14.3.1 the Agent (and any attorney, agent or delegate of the Agent)
may indemnify itself or himself out of the Trust Property
against all liabilities, costs, fees, damages, charges,
losses and expenses sustained or incurred by it or him in
relation to the taking or holding of any of the Trust
Property or in connection with the exercise or purported
exercise of the rights, trusts, powers and discretions
vested in the Agent or any other such person by or pursuant
to the Facility Documents or in respect of anything else
done or omitted to be done in any way relating to the
Facility Documents; and
14.3.2 the Finance Parties acknowledge that the Agent shall be
under no obligation to insure any property nor to require
any other person to insure any property and shall not be
responsible for any loss which may be suffered by any person
as a result of the lack or insufficiency of any insurance;
and
14.3.3 the Agent and the Finance Parties agree that the perpetuity
period applicable to the trusts declared by this Agreement
shall be the period of 80 years from the Execution Date.
14.4 Limitations on authority Except with the prior written consent of each
of the Banks, the Agent shall not be entitled to:
14.4.1 release any material amount of security given for payment of
the Obligations, except as expressly provided for in the
Facility Documents;
14.4.2 except as otherwise provided in the Facility Documents,
agree to waive the payment of any sum of money payable by
any of the Obligors under the Facility Documents;
-47-
14.4.3 change the meaning of the expression "Instructing Group";
14.4.4 exercise, or refrain from exercising, any discretion, or
give or withhold any consent, the exercise or giving of
which is, by the terms of this Agreement, expressly reserved
to the Banks;
14.4.5 extend the due date for the payment of any sum of money
payable by any of the Obligors under the Facility Documents;
14.4.6 take or refrain from taking any action if the effect of such
action or inaction may increase the Commitments of the Banks
or subject the Banks to any additional obligations under any
of the Facility Documents, other than as contemplated by
such Facility Documents;
14.4.7 agree to change the currency in which any sum is payable
under the Facility Documents (other than in accordance with
the terms of the Facility Documents);
14.4.8 agree to amend this Clause 14.4;
14.4.9 agree to amend Clause 12.1, 12.2 or 16.1; or
14.4.10 change the meaning of the expression "Equity Contribution".
14.5 Issuing Banks' Consent Except with the prior written consent of each
of the Issuing Banks, the Agent shall not be entitled to take or
refrain from taking any action if the effect of such action or
inaction may subject an Issuing Bank to any additional obligations
under any of the Facility Documents, other than as contemplated by
such Facility Documents.
14.6 Liability Neither the Agent nor any of its directors, officers,
employees or agents shall be liable to the Finance Parties for
anything done or omitted to be done by the Agent under or in
connection with the Facility Documents unless as a result of the
Agent's wilful misconduct or gross negligence.
14.7 Acknowledgement Each of the Finance Parties acknowledges that:
14.7.1 it has not relied on any representation made by the Agent or
any of the Agent's directors, officers, employees or agents
or by any other person acting or purporting to act on behalf
of the Agent to induce it to enter into any of the Facility
Documents;
14.7.2 it has made and will continue to make without reliance on
the Agent, and based on such documents and other evidence as
it considers appropriate, its own independent investigation
of the financial condition and affairs of the Obligors in
connection with the making and continuation of the Facility;
14.7.3 it has made its own appraisal of the creditworthiness of the
Obligors; and
14.7.4 the Agent shall not have any duty or responsibility at any
time to provide it with any credit or other information
relating to any of the Obligors unless
-48-
that information is received by the Agent pursuant to the
express terms of the Facility Documents.
Each of the Finance Parties agrees that it will not assert nor seek to
assert against any director, officer, employee or agent of the Agent
or against any other person acting on behalf of the Agent any claim
which it might have against them in respect of any of the matters
referred to in this Clause 14.7.
Notwithstanding anything to the contrary contained in this Agreement,
the Arranger is a Bank designated as "Arranger" for title purposes
only and in such capacity shall have no obligations or duties
whatsoever under this Agreement or any other Facility Document to any
Finance Party and shall have no rights separate from its rights as a
Bank except as expressly provided in this Agreement.
14.8 Limitations on responsibility The Agent shall have no responsibility
to any of the Obligors or the Finance Parties on account of:
14.8.1 the failure of a Finance Party or of any of the Obligors to
perform any of its respective obligations under the Facility
Documents;
14.8.2 the financial condition of any of the Obligors;
14.8.3 the completeness or accuracy of any statements,
representations or warranties made in or pursuant to any of
the Facility Documents, or in or pursuant to any document
delivered pursuant to or in connection with any of the
Facility Documents;
14.8.4 the negotiation, execution, effectiveness, genuineness,
validity, enforceability, admissibility in evidence or
sufficiency of any of the Facility Documents or of any
document executed or delivered pursuant to or in connection
with any of the Facility Documents.
14.9 The Agent's rights The Agent may:
14.9.1 assume that all representations or warranties made or deemed
repeated by any of the Obligors in or pursuant to any of the
Facility Documents are true and complete, unless, in its
capacity as the Agent, it has acquired actual knowledge to
the contrary; and
14.9.2 assume that no Default has occurred unless, in its capacity
as the Agent, it has acquired actual knowledge to the
contrary; and
14.9.3 rely on any document or Communication believed by it to be
genuine; and
14.9.4 rely as to legal or other professional matters on opinions
and statements of any legal or other professional advisers
selected or approved by it; and
14.9.5 rely as to any factual matters which might reasonably be
expected to be within the knowledge of any of the Obligors
on a certificate signed by or on behalf of that Obligor; and
-49-
14.9.6 refrain from exercising any right, power, discretion or
remedy unless and until instructed to exercise that right,
power, discretion or remedy and as to the manner of its
exercise by the Banks (or, where applicable, by an
Instructing Group) and unless and until the Agent has
received from the Banks any payment which the Agent may
require on account of, or any security which the Agent may
require for, any costs, claims, expenses (including legal
and other professional fees) and liabilities which it
considers it may incur or sustain in complying with those
instructions.
14.10 The Agent's duties The Agent shall:
14.10.1 if requested in writing to do so by a Bank or Issuing Bank,
make enquiry and advise the Banks or Issuing Banks, as the
case may be, as to the performance or observance of any of
the provisions of the Facility Documents by any of the
Obligors or as to the existence of an Event of Default; and
14.10.2 promptly notify the Banks of the occurrence of any Default
of which the Agent has actual knowledge;
14.10.3 promptly notify the Banks of the contents of any notice,
request or document received by it in its capacity as Agent
from any Obligor pursuant to any Facility Document; and
14.10.4 advise the Banks on monthly basis with respect to the Bank
Guarantee Outstandings and the Cash Collateral.
14.11 No deemed knowledge The Agent shall not be deemed to have actual
knowledge of the falsehood or incompleteness of any representation or
warranty made or deemed repeated by any of the Obligors or actual
knowledge of the occurrence of any Default unless a Bank or any of the
Obligors shall have given written notice thereof to the Agent.
14.12 Other business The Agent may, without any liability to account to the
Banks, generally engage in any kind of banking or trust business with
any of the Obligors or any of their respective Subsidiaries or
associated companies or with a Bank as if it were not the Agent.
14.13 Indemnity The Banks shall, promptly on the Agent's request, reimburse
the Agent in their respective Proportionate Shares, for, and keep the
Agent fully indemnified in respect of all liabilities, damages, costs
and claims sustained or incurred by the Agent in connection with the
Facility Documents, or the performance of its duties and obligations,
or the exercise of its rights, powers, discretions or remedies under
or pursuant to any of the Facility Documents; or in connection with
any action taken or omitted by the Agent under or pursuant to any of
the Facility Documents, unless in any case those liabilities, damages,
costs or claims arise solely from the Agent's wilful misconduct or
gross negligence.
14.14 Employment of agents In performing its duties and exercising its
rights, powers, discretions and remedies under or pursuant to the
Facility Documents, the Agent shall be entitled to employ and pay
agents to do anything which the Agent is empowered to
-50-
do under or pursuant to the Facility Documents (including the receipt
of money and documents and the payment of money) and to act or refrain
from taking action in reliance on the opinion of, or advice or
information obtained from, any lawyer, banker, broker, accountant,
valuer or any other person believed by the Agent in good faith to be
competent to give such opinion, advice or information.
14.15 Distribution of payments The Agent shall pay promptly to the order of
each of the Banks that Bank's Proportionate Share (or to the Issuing
Banks the amounts to which they are entitled) of every sum of money
received by the Agent pursuant to the Facility Documents or the
Mortgagees' Insurances (with the exception of any amounts which, by
the terms of the Facility Documents, are paid to the Agent for
retention on account of the Obligations or for the account of the
Agent alone or specifically for the account of one or more Banks or
Issuing Banks) and until so paid such amount shall be held by the
Agent on trust absolutely for that Bank (or that Issuing Bank).
14.16 Reimbursement The Agent shall have no liability to pay any sum to a
Bank (or an Issuing Bank) until it has itself received payment of that
sum. If, however, the Agent does pay any sum to a Bank (or an Issuing
Bank) on account of any amount prospectively due to it pursuant to
Clause 14.15 before it has itself received payment of that amount, and
the Agent does not in fact receive payment within five Business Days
after the date on which that payment was required to be made by the
terms of the Facility Documents or the Mortgagees' Insurances, the
recipient will, on demand by the Agent, refund to the Agent an amount
equal to the amount received by it, together with an amount sufficient
to reimburse the Agent for any amount which the Agent may certify that
it has been required to pay by way of interest on money borrowed to
fund the amount in question during the period beginning on the date on
which that amount was required to be paid by the terms of the Facility
Documents or the Mortgagees' Insurances and ending on the date on
which the Agent receives reimbursement.
14.17 Redistribution of payments Unless otherwise agreed between the
Finance Parties, if at any time a Bank receives or recovers by way of
set-off, the exercise of any Encumbrance or otherwise (other than from
any assignee or transferee of or sub-participant in that Bank's
Commitment or credit insurer of or issuer of a credit derivative in
respect thereof), an amount greater than that Bank's Proportionate
Share of any sum due from any of the Obligors under the Facility
Documents (the amount of the excess being referred to in this Clause
as the "Bank's Excess Amount") then:
14.17.1 that Bank shall promptly notify the Agent (which shall
promptly notify each other Bank);
14.17.2 that Bank shall pay to the Agent an amount equal to the
Bank's Excess Amount within 10 days of its receipt or
recovery of the Bank's Excess Amount; and
14.17.3 the Agent shall treat that payment as if it were a payment
by the Obligor in question on account of the sum owed to the
Banks as aforesaid and shall account to the Banks in respect
of the Bank's Excess Amount in accordance with the
provisions of this Clause.
-51-
However, if a Bank has commenced any Proceedings to recover sums owing
to it under the Facility Documents and, as a result of, or in
connection with, those Proceedings has received a Bank's Excess
Amount, the Agent shall not distribute any of that Bank's Excess
Amount to any other Bank which had been notified of the Proceedings
and had the legal right to, but did not, join those Proceedings or
commence and diligently prosecute separate Proceedings to enforce its
rights in the same or another court.
14.18 Rescission of Bank's Excess Amount If all or any part of any Bank's
Excess Amount is rescinded or must otherwise be restored to any of the
Obligors or to any other third party, the Banks which have received
any part of that Bank's Excess Amount by way of distribution from the
Agent pursuant to this Clause shall repay to the Agent for the account
of the Bank which originally received or recovered the Bank's Excess
Amount, the amount which shall be necessary to ensure that the Banks
share rateably in accordance with their Proportionate Shares in the
amount of the receipt or payment retained, together with interest on
that amount at a rate equivalent to that (if any) paid by the Bank
receiving or recovering the Bank's Excess Amount to the person to whom
that Bank is liable to make payment in respect of such amount, and
Clause 14.17.3 shall apply only to the retained amount.
14.19 Proceedings Each of the Finance Parties shall notify one another of
the proposed commencement of any Proceedings under any of the Facility
Documents prior to their commencement. No such Proceedings may be
commenced without the prior written consent of an Instructing Group.
14.20 Instructions Where the Agent is authorised or directed to act or
refrain from acting in accordance with the instructions of the Banks
or of an Instructing Group each of the Banks shall provide the Agent
with instructions within five Business Days of the Agent's request
(which request shall be made in writing). If a Bank does not provide
the Agent with instructions in writing within that period, (i) that
Bank shall be bound by the decision of the Agent, (ii) that Bank shall
have no vote for the purposes of this Clause 14 and (iii) the combined
Proportionate Shares of the other Banks who provided such instructions
shall be deemed to contribute 100%. Nothing in this Clause 14 shall
limit the right of the Agent to take, or refrain from taking, any
action without obtaining the instructions of the Banks if the Agent in
its discretion considers it necessary or appropriate to take, or
refrain from taking, such action in order to preserve the rights of
the Banks under or in connection with the Facility Documents. In that
event, the Agent will notify the Banks of the action taken by it as
soon as reasonably practicable, and the Banks agree to ratify any
action taken by the Agent pursuant to this Clause 14.
14.21 Communications Any Communication under this Clause 14 shall be given,
delivered, made or served, in the case of the Agent (in its capacity
as Agent or as one of the Finance Parties), and in the case of the
other Finance Parties, at the address indicated in Part B of Schedule
1 or such other address as shall be duly notified in writing to the
Agent on behalf of a Bank. Any Communication to the Agent shall be
effective only when received by the Agent.
14.22 Payments All amounts payable to a Finance Party under this Clause 14
shall be paid to such account at such bank as that Finance Party may
from time to time direct in writing to the Agent.
-52-
14.23 Retirement Subject to a successor being appointed in accordance with
this Clause 14, the Agent may retire as agent and/or security trustee
at any time without assigning any reason by giving to the Obligors'
Agent and the other Finance Parties notice of its intention to do so,
in which event the following shall apply:
14.23.1 with the consent of the Obligors' Agent, not to be
unreasonably withheld except that no such consent shall be
required during an Event of Default, the other Finance
Parties may within 30 days after the date of the Agent's
notice appoint a successor to act as agent and/or security
trustee or, if they fail to do so with the consent of the
Obligors' Agent, not to be unreasonably withheld except that
no such consent shall be required during an Event of
Default, the Agent may appoint any other bank or financial
institution as its successor;
14.23.2 the resignation of the Agent shall take effect
simultaneously with the appointment of its successor on
written notice of that appointment being given to the
Indemnifiers and the other Finance Parties;
14.23.3 the Agent shall thereupon be discharged from all further
obligations as agent and/or security trustee but shall
remain entitled to the benefit of the provisions of this
Clause 14;
14.23.4 the Agent's successor and each of the other parties to this
Agreement shall have the same rights and obligations amongst
themselves as they would have had if that successor had been
a party to this Agreement.
14.24 No fiduciary relationship Except as provided in Clauses 14.3 and
14.15, the Agent shall not have any fiduciary relationship with or be
deemed to be a trustee of or for a Bank and nothing contained in any
of the Facility Documents shall constitute a partnership between any
two or more Banks or between the Agent and any Bank.
14.25 The Agent as a Bank and an Issuing Bank The expression "the Banks" or
"the Issuing Banks" when used in the Facility Documents includes the
Agent in its capacity as one of the Banks or the Issuing Banks, as the
case may be. The Agent shall be entitled to exercise its rights,
powers, discretions and remedies under or pursuant to the Facility
Documents in its capacity as one of the Banks or the Issuing Banks in
the same manner as any other Bank or Issuing Bank and as if it were
not also the Agent.
14.26 The Agent as security trustee Unless the context otherwise requires,
the expression "the Agent" when used in the Facility Documents
includes the Agent acting in its capacity as agent or as security
trustee.
15 COVENANTS
15.1 Negative covenants XXXX, each of the Indemnifiers and each of the
other Guarantors covenants with and undertakes to the Finance Parties
that it shall not, and shall ensure that no other Obligor or other
member of the SO Group that is its Subsidiary shall, without the prior
written consent of an Instructing Group:
15.1.1 Encumbrances create or permit to arise or continue any
Encumbrance on or over all or any part of its assets
(including accounts receivable) or undertakings except
Permitted Liens; or
-53-
15.1.2 chartering (a) charter any Vessel or permit any Vessel to be
chartered on any bareboat charter, or otherwise for a period
exceeding (or inclusive of any extension options, capable of
exceeding) 12 months provided that committing a Vessel for
several periods, each of 12 months or less but for an
aggregated period exceeding 12 months shall not be deemed to
be a breach of this Clause, (b) charter any Vessel or permit
any Vessel to be chartered on any bareboat charter or
otherwise to a member of the SO Group for any period unless
the relevant charterer has executed a charterer's
subordination undertaking in the agreed form in favour of
the Security Trustee or the Agent, as the case may be or (c)
following the occurrence and during the continuation of an
Event of Default, let any Vessel on charter (including a
charter otherwise permitted by this Clause 15.1.2 unless the
same was entered into prior to the occurrence of any such
Event of Default) or renew or extend any charter or other
contract of employment of any such Vessel (nor agree to do
so); or
15.1.3 no change in Vessel management permit the appointment of
anyone other than the Managers as commercial or technical
managers of the Vessels, nor terminate or amend any
Management Agreement and/or the arrangements for the
commercial or technical management of the Vessels in a
manner which is, in the reasonable opinion of the Agent,
detrimental to the interest of the Finance Parties or any of
them, nor permit the Managers to sub-contract or delegate
the commercial or technical management of any Vessel to any
third party outside of the SO Group provided that any
termination or amendment of any Management Agreement and/or
management arrangements referred to above with a member of
the SO Group shall not be deemed to be detrimental to the
interests of the Finance Parties or any of them where any
new manager (being within the SO Group) enters into an
agreement with the Agent or the Security Trustee, as the
case may be, subordinating its rights in such Vessel to
those of the Finance Parties in terms substantially the same
as contained in those agreements/arrangements entered into
immediately before such amendment and procure that any
Manager which is at any time a member of the SO Group enters
into such an agreement with the Security Trustee or the
Agent; or
15.1.4 merger or amalgamation permit any merger or amalgamation
unless (i) a Guarantor, an Indemnifier or a Shipowning
Guarantor remains the surviving entity following any such
merger or amalgamation (or if the merger or amalgamation
involves more than one of the Guarantors, the Indemnifiers
or the Shipowning Guarantors, then one of such Guarantors,
such Indemnifiers or such Shipowning Guarantors remains the
surviving entity) and (ii) such surviving entity is a member
of the SO Group and an Obligor and (iii) in the case of XXXX
only, such merger or amalgamation has been approved by a
duly passed resolution of XXXX'x shareholders and (iv) no
Default is then continuing or would result therefrom; or
-54-
15.1.5 capital expenditure permit the aggregate Capital
Expenditures of the SO Group in respect of any financial
year of XXXX to exceed the maximum expenditure provided
therefor in the Approved Budget for that financial year; or
15.1.6 other permitted expenditures make any other expenditure in
excess of $2,000,000 not contemplated by the Approved Budget
for that financial year; or
15.1.7 acquisitions other than in the ordinary course of business
and in accordance with past practice and the Approved
Budget, permit any member of the SO Group to (i) purchase,
subscribe for or otherwise acquire any shares (or other
securities or any interest therein) in, or incorporate, any
other company or agree to do any of the foregoing; or (ii)
purchase or otherwise acquire any business or any assets
which, when taken together, constitute a business; or
15.1.8 dividends and distributions pay, make or declare any
dividend, return on capital, repayment of capital
contributions or other distribution (whether in cash) or
make any distribution of assets or other payment whatsoever
in respect of share capital and shareholder loans at any
time, other than any such payments to any member of the SO
Group; or
15.1.9 restrictions on prepayments pay, prepay or repay or defease,
exchange or repurchase or otherwise satisfy prior to the
scheduled maturity thereof or make a payment in violation of
any subordination terms of any Permitted Indebtedness
(provided however that the provisions of this Clause 15.1.9
shall not apply to the Existing Credits to the extent
provided in the Intercreditor, Override and Security Trust
Deed) or (without prejudice to Clause 1.3.5) prepay any
intercompany Indebtedness owed by the Obligors' Agent to
XXXX or SO BV if as a result of any such prepayment the
amount outstanding thereunder is less than 125% of the
Commitments; or
15.1.10 loans and guarantees make any loans, grant any credit or
other financial accommodation or give any guarantee (except
as required by the Facility Documents) to or for the benefit
of any person or otherwise voluntarily assume any liability,
whether actual or contingent, in respect of any obligation
of any other person except:
(a) any loans and indemnities in respect of guarantees
existing at the Execution Date and disclosed in
Schedule 21;
(b) credit granted in the ordinary course of trade;
(c) indemnities or guarantees given by one member of the SO
Group in respect of Indebtedness or other obligations
of another member of the SO Group or by a member of the
SO Group in respect of Indebtedness or other
obligations of a joint venture company of a member of
the SO Group, in each case permitted to be incurred
hereunder, provided that each such indemnity or
guarantee is
-55-
unsecured, given in the ordinary course of trading and
upon terms usual for such trade;
(d) loans made by one member of the SO Group to another
member of the SO Group in connection with ordinary
day-to-day cash management arrangements;
(e) loans made by a member of the SO Group to a joint
venture company of a member of the SO Group provided in
the ordinary course of business and in accordance with
past practice and the Approved Budget; and
(f) loans from any member of the SO Group to XXXX for the
sole purpose of financing XXXX'x normal operating cash
flow needs; or
15.1.11 disposals
sell, lease, transfer or otherwise dispose of, by one or
more transactions or series of transactions (whether related
or not), the whole or any part of its revenues or its assets
(including any Vessel) or its business or undertakings
(including any Shipowning Guarantor) other than:
(a) Disclosed Permitted Disposals;
(b) disposals of inventory made in the ordinary and usual
course of business on arm's length commercial terms;
(c) disposals of cash in the ordinary course of business;
(d) disposals of obsolete assets not required for the
operation of the businesses of the SO Group;
(e) disposals of Vessels by one member of the SO Group to
another member of the SO Group provided that the sale
or disposal, in whole or in part, is made to a member
of the SO Group who is or will become a Shipowning
Guarantor upon the acquisition of such Vessel and who
will execute and deliver to the Agent a Shipowners'
Guarantee, a Mortgage and an Assignment in respect of
such Vessel in substantially the same terms as those
Facility Documents already executed in favour of the
Security Trustee and delivered to the Agent which shall
be accompanied by such corporate documents and legal
opinions as the Agent may request (and upon any sale or
disposal of a Shipowning Guarantor or its Vessel such
Shipowning Guarantor's obligations under the Facility
Documents to which it is a party will (unless such
Shipowning Guarantor will continue to own any of the
Vessels following such sale or disposal of a Vessel)
terminate provided that no Event of Default is
continuing or would result therefrom and the provisions
of this Clause 15.1.11 have been fully complied with);
or
-56-
(f) disposals of any Vessel where such Vessel is replaced
by a similar asset acceptable to an Instructing Group
of equal or greater value; or
(g) disposals where the higher of the market value or
consideration receivable which (when aggregated with
the higher of the market value or consideration
receivable for any other disposal effected since the
date of this Agreement, other than any permitted under
paragraphs (a) to (f) above) does not exceed in any
financial year $10,000,000 or its equivalent in another
currency or currencies; or
15.1.12 amendments amend, vary, modify or supplement any provision
of the constitutional documents of any member of the SO
Group, except to the extent that a Material Adverse Effect
would not reasonably be expected to result therefrom and the
rights and interests of the Finance Parties pursuant to the
Facility Documents would not be materially adversely
affected thereby; or
15.1.13 share capital redemption redeem, repurchase, defease,
retire, dispose of, return, repay or reduce its share
capital or redeem or reduce its capital redemption or other
reserve; or
15.1.14 Permitted Indebtedness have any Indebtedness other than
Permitted Indebtedness or unsecured intercompany
Indebtedness incurred in the ordinary course of business.
15.2 Positive covenants Except as otherwise agreed in writing by an
Instructing Group:
15.2.1 Vessels Each of the Indemnifiers and each of the Guarantors
undertakes to procure that in respect of each such relevant
Shipowning Guarantor owning such Vessel that is a member of
the SO Group and its Subsidiary will comply with the
obligations set out in Schedule 14.
15.2.2 Insurance Proceeds Each of the Indemnifiers and each of the
Guarantors shall, and shall procure in respect of its
Subsidiaries that (i) all Insurance Proceeds Amounts in
connection with any Total Loss are immediately deposited in
Lock Box One as additional security for the payment of the
Obligations, (ii) any other Insurance Proceeds Amounts are
used to meet repair expenses; provided, however, that if
repair expenses are likely to exceed a Casualty Amount, the
Insurance Proceeds Amounts in respect of such expenses shall
be paid to the Agent (if for any reason such Insurance
Proceeds Amounts are paid prior to works being completed)
and, at the Agent's sole discretion, applied against such
expenses upon the works being completed or otherwise or,
prior to the occurrence of an Event of Default (whereupon
all insurance sums shall be paid to the Agent as additional
security for the payment of the Obligations) all Insurance
Proceeds Amounts in respect of the Insurances against
protection and indemnity or other third party liability
risks shall be paid direct to the person to whom was
incurred the liability to which such sum relates or, where
such liability has been satisfied, to the person who has
satisfied such liability in reimbursement to it of moneys
expended in satisfaction of such liability.
-57-
15.2.3 Financial statements XXXX will supply to the Agent without
request (together in each case, where the item is generally
available in printed form, with a copy for distribution by
the Agent to each of the Banks):
(a) the annual unaudited financial statements of each
Obligor that is a Principal Subsidiary of XXXX for each
financial year ending during the Facility Period,
containing (amongst other things) such Obligor's profit
and loss account for, and balance sheet at the end of,
each such financial year, prepared in accordance with
generally accepted accounting principles and practices
applicable to companies incorporated in the relevant
jurisdiction consistently applied, in each case within
180 days of the end of the financial year to which they
relate, together with a certificate of the chief
financial officer or chief executive officer of XXXX to
the effect that, to the best of his knowledge and
belief, such financial statements accurately and fairly
represent the financial condition of such Obligor;
(b) on a consolidated basis:
(i) XXXX'x annual audited accounts prepared in
accordance with US GAAP within 180 days after the
end of the financial year to which they relate,
together with a report from XXXX'x independent
public accountants that, such financial statements
accurately and fairly represent the financial
condition and results of operations of the SO
Group; and
(ii) XXXX'x unaudited quarterly financial statements
(including cash flow analysis) not later than 90
days after the end of the relevant fiscal quarter,
together with a certificate of the chief financial
officer or chief executive officer of XXXX to the
effect that, to the best of his knowledge and
belief, such financial statements accurately and
fairly represent the financial condition and
results of operations of the SO Group,
in each case with comparisons of actual performance
against projected performance;
(c) the Approved Budget for each ensuing financial year, as
soon as the same becomes available but in any event not
later than the start of such financial year;
(d) together with the Approved Budget, a consolidated cash
flow projection of the SO Group for the ensuing
financial year and the following two years (broken down
by year);
(e) XXXX'x monthly unaudited internal management accounting
reports comprising the consolidated statement of profit
and loss and the consolidated statement of cashflow as
soon as practicable but in any event not later than 35
days, or, in respect of months of February,
-00-
Xxx, Xxxxxx and November, not later than 60 days, after
the month end to which they relate;
(f) a monthly update, within 35 days or, in respect of
months of February, May, August and November, within 60
days, after month end, on (i) XXXX'x receivables and/or
collections substantially in the form of Schedule 13
and (ii) projects in respect of which the Indemnifiers
expect that either (x) revenue will be $1,000,000 or
25% (whichever is the higher amount) less or (y) costs
$1,000,000 or 25% (whichever is the higher amount)
more, than as originally budgeted;
(g) on a monthly basis, within 35 days, or, in respect of
months of February, May, August and November, within 60
days, after month end, information relating to any
Disclosed Permitted Disposal, including quarterly
updates as to the progress of any on-going Disclosed
Permitted Disposal, and details of any new Eligible
Project with a contract value in excess of $25,000,000
that any member of the SO Group has agreed to enter
into from time to time; and
(h) a rolling 12-week cashflow projection and the other
information set forth in Schedule 20 to be provided at
the end of each four-week period within 30 days after
the end of each such period.
15.2.4 Other information
(a) Other information XXXX shall promptly provide or cause
to be provided to the Agent such other information,
financial data and explanations as the Agent may from
time to time reasonably require in respect of Obligors
that are members of the SO Group and in any event
copies of all press releases and all financial and
other information from time to time given by XXXX to
its shareholders generally.
(b) Presentations The senior executive management and/or
members of the board of directors of XXXX shall from
time to time at the reasonable request of the Agent,
deliver presentations to the Finance Parties in
relation to such matters as the Agent may reasonably
request.
(c) Risk Management Report At any time at the reasonable
request of the Agent, XXXX will engage KPMG or another
adviser acceptable to the Agent to produce and deliver
an update of their risk management systems analysis
report in respect of the SO Group.
(d) Contracts Report At any time at the reasonable request
of the Agent, XXXX will engage KPMG or another adviser
acceptable to the Agent to produce and deliver a report
in relation to any existing
-59-
contract or project, including commentary on the status
of such contract or project and its performance against
budget.
15.2.5 Certificate of Compliance XXXX shall deliver to the Agent
with each set of its annual and quarterly financial
statements a duly executed Certificate of Compliance
substantially in the form of Schedule 6 certifying (inter
alia) compliance with the covenant contained in Clause 15.3.
15.2.6 Inspection of records XXXX will permit and will cause each
member of the SO Group to permit the inspection of its
financial records and accounts from time to time on
reasonable notice during business hours by the Agent or its
nominee.
15.2.7 Notification of Default XXXX, each of the Indemnifiers and
the Guarantors will immediately notify the Agent in writing
of the occurrence of any Default or any event which would
reasonably be likely to have a Material Adverse Effect.
15.2.8 Additional Filings XXXX shall ensure that any and all
additional filings referred to in the proviso to Clause 7.5
will be made and/or effected promptly and within any
applicable time limits imposed by law.
15.2.9 Pari Passu XXXX, each of the Indemnifiers and the Guarantors
shall, and shall procure that its Subsidiaries shall, ensure
that their respective obligations under this Agreement shall
at all times rank at least pari passu with all of their
other present and future unsecured and unsubordinated
indebtedness with the exception of any obligations which are
mandatorily preferred by any applicable laws to companies
generally and not by contract.
15.2.10 Corporate Existence Save as permitted by Clause 15.1.4,
XXXX, each Indemnifier and each other Guarantor shall in
respect of itself and its Subsidiaries ensure that
throughout the Facility Period each of the Obligors shall
(i) remain duly formed and validly existing under the laws
of its respective jurisdiction of incorporation, (ii) remain
authorised to do business in the jurisdiction in which it
transacts its business, (iii) continue to have the power to
carry on its business as it is now being conducted and to
enter into and perform its obligations under the Facility
Documents to which it is a party, and (iv) continue to
comply with all statutory, regulatory and other requirements
relative to its business, the non-compliance with which
could reasonably be expected to have a Material Adverse
Effect.
15.2.11 Admissibility in Evidence XXXX, each Indemnifier and each
other Guarantor shall on the request of the Agent obtain all
necessary authorisations, consents, approvals, licences,
exemptions, filings, registrations, recordings and
notarisations required or advisable in connection with the
admissibility in evidence of the Facility Documents or any
of them in Proceedings in England or any other jurisdiction
in which Proceedings have been commenced.
-60-
15.2.12 XXXX'x Company Status XXXX shall ensure that throughout the
Facility Period it operates as a financial holding company
under Luxembourg law pursuant to the terms of a letter of
the "Administration de l'Enregistrement et des Domaines"
dated 9 September 1994 and within the restricted scope of
its finance holding status.
15.2.13 Subordinated Debt XXXX shall ensure that throughout the
Facility Period the Subordinated Debt shall be provided on
the terms of the Subordinated Note, save to the extent that
SNTG converts, cancels or contributes the Subordinated Debt
in return for the issuance of Common Shares or as otherwise
contemplated by the terms of the Subordinated Note.
15.2.14 Cash Management System XXXX shall procure that each member
of the SO Group complies with the Cash Management System.
15.2.15 Disposals Targets XXXX shall ensure that Disclosed Permitted
Disposals are completed on or before each date set out in
column 1 below to generate cumulative Net Disposal Proceeds
received by such date of not less than the amount
corresponding to such date set out in column 2 below:
Column 1 Column 2
Date Amount
31 May 2004 $50,000,000
31 August 2004 $75,000,000
15.2.16 Insurances XXXX shall procure that each Shipowning Guarantor
that is a member of the SO Group shall ensure that each of
the Vessels owned by such Shipowning Guarantor is at all
times fully insured upon the terms and conditions set forth
in Schedule 14.
15.2.17 Valuations XXXX shall procure that annual Valuations of the
Vessels are provided to the Agent no later than each
anniversary date of the first Valuations pursuant to Clause
6.2.12, and at any other time at the request of the Agent.
15.2.18 Net Disposal Proceeds and Insurance Proceeds Amounts XXXX
shall, and shall procure that a relevant Obligor will,
promptly deposit 100% of Net Disposal Proceeds and Insurance
Proceeds Amounts in connection with a Total Loss or sale of
a Vessel over which there is a first lien for the benefit of
the Banks into Lock Box One.
15.3 XXXX'x Financial Covenant/Minimum Consolidated Tangible Net Worth XXXX
shall not permit its Consolidated Tangible Net Worth on and after each
date set forth in column 1 below to be less than the amount
corresponding to such date set forth in column 2 below as determined
on the basis of the quarterly financials due on the date corresponding
thereto as set forth in column 3 below; provided, however, that for
the purposes of compliance with this covenant there shall be deducted
from Consolidated Tangible Net Worth the amount of any Indebtedness of
XXXX or any of
-61-
its Subsidiaries to SNSA or any of its Subsidiaries that has been
capitalised after 31 December 2003 and the amount of the Equity
Contribution:
Column 1 Column 2 Column 3
Measuring Date Amount Last Date for Delivery of
Related Financials
31 May 2004 $100,000,000 31 August 2004
31 August 2004 $100,000,000 30 November 2004
30 November 2004 $85,000,000 28 February 2005
28 February 2005 $100,000,000 31 May 2005
In the event that the corresponding covenant with respect to XXXX'x
Consolidated Tangible Net Worth in the Intercreditor, Override and Security
Trust Deed is re-set as provided in Clause 6.2(b) of the Intercreditor,
Override and Security Trust Deed, then the equivalent provision in this
Clause 15.3 shall no longer apply and such re-set covenant in respect of
XXXX'x Consolidated Tangible Net Worth shall be incorporated mutatis
mutandis, into this Agreement, as though it were set out in full in this
Agreement.
15.4 Collateral Value Maintenance Without prejudice to Clauses 8 and 9 XXXX
shall ensure that:
15.4.1 Prior to Equity Contribution or no SNSA Guarantee at all
times until both the Equity Contribution shall have
occurred, and the SNSA Guarantee shall have been duly
executed and delivered and from and after the SNSA Guarantee
ceases to be in full force and effect (otherwise than in
accordance with its terms) or is repudiated, the Cash
Collateral shall at all times not be less than 100% of the
Bank Guarantee Outstandings at such time;
15.4.2 Post Equity Contribution after the Equity Contribution shall
have occurred (but subject to Clause 15.4.1 with respect to
the SNSA Guarantee):
(a) the Value of Qualifying Collateral shall at all times
not be less than 100% of the Bank Guarantee
Outstandings at such time;
(b) the Cash Collateral shall at all times not be less than
50% of the Bank Guarantee Outstandings at such time;
and
(c) the Value of Qualifying Vessel Collateral shall at all
times be not less than 120% of the difference between
the Bank Guarantee Outstandings and the Cash
Collateral; and
15.4.3 Post Covenant Release Date after the Covenant Release Date
the Cash Collateral shall at all times not be less than 100%
of the aggregate Bank Guarantee Outstandings at such time.
15.5 Compliance with covenants in the Existing Credit Agreements In the
event that in connection with the Junior Vessels compliance by any
Obligor with any covenant or undertaking set out in any Facility
Document would be inconsistent with
-62-
compliance with an analogous provision set out in an Existing Credit
Agreement, then compliance with such provision in the relevant
Existing Credit Agreement shall, for the period of such compliance,
constitute compliance with the particular similar covenant or
undertaking in the Facility Document.
15.6 Covenants and Account Pledge Release In the event that following 30
September 2005 (i) all Indebtedness under the $440m Loan Agreement has
been irrevocably and unconditionally repaid in full, (ii) all Bank
Guarantee Outstandings are fully Cash Collateralised at such time and
(iii) no Default has occurred and is continuing or would result from
giving effect to such request or action:
15.6.1 Covenant Release at the request of the Obligors' Agent, the
covenants contained in this Clause 15 (except for Clauses
15.1.2, 15.1.3, 15.1.11, 15.2.1, 15.2.2, 15.2.16, 15.2.17,
15.2.18 and 15.4.3) shall cease to be binding on the
Obligors from the date falling five Business Days after such
notification from the Obligors' Agent is received by the
Agent (the "Covenant Release Date"); and
15.6.2 Release of Account Pledge the Agent will instruct the
Security Trustee to discharge and release the Account Pledge
over Lock Box Two.
16 EARNINGS
16.1 Remittance of Earnings Immediately upon the occurrence of an Event of
Default and thereafter for so long as it continues, the Obligors'
Agent shall procure that all Earnings are paid to such account(s) as
the Agent shall from time to time specify by notice in writing to the
Obligors' Agent in accordance with the terms of the Assignments,
subject to applicable law and prior contractual arrangements.
17 EVENTS OF DEFAULT
17.1 The Agent's rights If any of the events set out in Clause 17.2 occurs,
and if such event is in the reasonable opinion of an Instructing Group
is capable of remedy and remains unremedied for 14 days after notice
thereof has been given by the Agent to the Obligors' Agent (except in
relation to any of the events described in Clauses 17.2.1, 17.2.3,
17.2.4, 17.2.5, 17.2.6, 17.2.7, 17.2.12, 17.2.18 and 17.2.22 where
such remedy period shall not apply) the Agent may at its discretion
and shall if so directed by an Instructing Group by notice to the
Obligors' Agent declare the Banks, the Issuing Banks and the Agent to
be under no further obligation to the Obligors' Agent or any other
Obligor under or pursuant to this Agreement including to issue any
further Bank Guarantees, may declare all or any part of the
Obligations (including such unpaid interest as shall have accrued) to
be immediately payable, whereupon the Obligations (or the part of the
Obligations referred to in the Agent's notice) shall immediately
become due and payable without any further demand or notice of any
kind and may exercise its rights under Clause 9.1 to demand cash
cover.
17.2 Events of Default The events referred to in Clause 17.1 are:
17.2.1 payment default if any Obligor defaults in the payment of
any part of the Obligations when due (or within three
Business Days of such date where default is due solely to an
error in the transmission of funds); or
-63-
17.2.2 other default if any Obligor fails to observe or perform any
of the covenants, conditions, undertakings, agreements or
obligations on its part contained in any of the Facility
Documents or shall in any other way be in breach of any of
the Facility Documents; or
17.2.3 misrepresentation or breach of warranty if any
representation, warranty or statement made, deemed to be
made, or repeated under any of the Facility Documents or in
any accounts, certificate, notice, instrument, written
statement or opinion delivered by or on behalf of an Obligor
under or in connection with any Facility Document is
incorrect in any material respect when made, deemed to be
made or repeated; or
17.2.4 execution if a distress, diligence or execution or other
process of a court or authority is levied on any of the
property of any of the Obligors or any of the Principal
Subsidiaries before or after final judgment or decree by
order of any competent court or authority for an amount in
excess of $10,000,000 or its equivalent in any other
currency and is not satisfied or stayed (with a view to
being contested in good faith) within 14 days of levy; or
17.2.5 insolvency events if any of the Obligors or any of the
Principal Subsidiaries:
(a) resolves to appoint, or applies for, or consents to the
appointment of, a receiver, administrative receiver,
trustee, administrator or liquidator of itself or of
all or part of its assets other than for the purposes
of a merger or amalgamation pursuant to Clause 15.1.4;
or
(b) is unable or admits its inability to pay its debts as
they fall due; or
(c) makes a general assignment for the benefit of
creditors; or
(d) ceases trading or threatens to cease trading; or
(e) has appointed an Inspector under the Companies Xxx 0000
or any statutory provision which the Agent in its
discretion considers analogous thereto; or
(f) commences negotiations with any one or more of its
creditors with a view to the general readjustment or
rescheduling of its indebtedness, other than as
contemplated by the Intercreditor, Override and
Security Trust Deed; or
17.2.6 insolvency proceedings if (i) any proceedings are commenced
or threatened, or any order or judgment is given by any
court, for the bankruptcy, liquidation, winding up, or
re-organisation of any of the Obligors or any of the
Principal Subsidiaries, which proceeding, if not commenced
by such Obligor or Principal Subsidiary, is not discharged
within 30 days of its commencement; or (ii) if any
encumbrancer takes possession of, or a receiver,
administrative receiver or administrator or similar officer
is appointed over or in relation to, all or any material
part of the assets of any Obligor or any Principal
Subsidiary; or (iii) a meeting is
-64-
convened, an application is made or any other step is taken,
or any notice is given of the intention to convene a meeting
or take any other step, for the purpose of appointing a
receiver, administrative receiver or other similar officer
of or in relation to any Obligor or any Principal
Subsidiary; or (iv) an application is made or any other such
document is issued, a meeting is convened, or any other step
is taken, or any notice is given of the intention to convene
a meeting or take any other step, for the purpose of
appointing an administrator or other similar officer of, or
for the making of an administration order in relation to any
Obligor or any Principal Subsidiary; or (v) if any person
appoints or purports to appoint a liquidator or trustee in
relation to any Obligor or any Principal Subsidiary; or (vi)
any creditor seeks to attach or enforce its Encumbrance on
any asset of the SO Group; in each case excluding any
frivolous or vexatious claims or proceedings.
17.2.7 impossibility or illegality unless covered by Clause 22.7,
if any event occurs which would, or would with the passage
of time, render performance of any of the Facility Documents
impossible, unlawful or unenforceable by the Banks, the
Agent or the Security Trustee; or
17.2.8 conditions subsequent if any of the conditions set out in
Clause 6.2 is not satisfied within the time reasonably
required by the Agent with respect to the conditions
referred to at Clauses 6.2.1 to 6.2.4 inclusive and
otherwise within the time period specified except where such
condition has not been satisfied due to an act or omission
on the part of a Finance Party; or
17.2.9 revocation or modification of consents etc. if any material
consent, licence, approval or authorisation which is now or
which at any time during the Facility Period becomes
necessary to enable any of the Obligors to comply with any
of their obligations in or pursuant to any of the Facility
Documents is revoked, withdrawn or withheld, or modified in
a manner which the Agent reasonably considers is, or may be,
prejudicial to the interests of the Banks in a material
manner, or any material consent, licence, approval or
authorisation ceases to remain in full force and effect; or
17.2.10 curtailment of business if the business of any of the
Obligors is wholly or partially curtailed by any
intervention by or under authority of any government, or if
all or a substantial part of the undertaking, property or
assets of any of the Obligors (other than a Vessel referred
to in Clause 15.2.2) is seized, nationalised, expropriated
or compulsorily acquired by or under authority of any
government; or
17.2.11 loss of Vessel if any Vessel, or any such other vessel which
may from time to time be mortgaged to the Banks (or to the
Agent or the Security Trustee on their behalf) as security
for the repayment of all or any part of the Obligations is
arrested, seized, taken in execution, impounded, detained in
exercise or purported exercise of any possessory lien or
other claim or otherwise taken from the possession of a
Shipowning Guarantor and such Shipowning Guarantor shall
fail to procure the release of such Vessel
-65-
within 21 days thereafter, provided that such an event is
likely to have a Material Adverse Effect, or such Vessel or
such other vessel is otherwise destroyed, abandoned,
confiscated, forfeited, condemned as prize or otherwise
becomes a Total Loss, except that a Total Loss shall not be
an Event of Default if:
(a) such Vessel or such other vessel (as the case may be)
is insured in accordance with the Facility Documents;
and
(b) payment of all Insurance Proceeds Amounts in respect of
the Total Loss (as required by Clause 15.2.2) is made
in full into Lock Box One on the date which is the
earlier to occur of (A) 180 days after the date of the
Total Loss of the relevant Mortgaged Vessel occurring
and (B) the date on which the relevant Shipowning
Guarantor (or the Agent or the Security Trustee as its
assignee pursuant to the relevant Assignment or, in
respect of the Junior Vessels, any agent or trustee
under the Existing Credit Agreements) receives the
proceeds of such Total Loss; or
17.2.12 default of other indebtedness if any other indebtedness or
obligation for borrowed money of any of the Obligors or any
Principal Subsidiary becomes due or capable of being
declared due prior to its stated maturity by reason of
default on the part of that Obligor or Principal Subsidiary
(as the case may be), or is not repaid or satisfied on the
due date for its repayment or any such other loan, guarantee
or indebtedness becomes enforceable save, in either case,
for amounts of less than five million Dollars ($5,000,000)
in the aggregate for all cases, or its equivalent in any
other currency, and claims contested in good faith; or
17.2.13 reduction of capital if any of the Obligors reduces its
authorised or issued or subscribed capital except reductions
effected in compliance with Clause 15.1.4; or
17.2.14 challenge to registration if the registration of any Vessel
or any Mortgage becomes void or voidable or liable to
cancellation or termination and, provided that the Agent is
satisfied that such circumstances have arisen for reasons
beyond the control of the relevant Shipowning Guarantor or
any other member of the SO Group, the relevant Shipowning
Guarantor has not within a period of 20 Business Days of the
relevant circumstances arising (or such longer period as the
Agent may agree) arranged for the re-registration of the
relevant Vessel in another jurisdiction subject to a
Mortgage in the agreed form and executed such further
documents as the Agent may in its absolute discretion
require in accordance with Clause 25.5 and provided to the
Agent such corporate authorities, vessel documents and legal
opinions (consistent with those provided pursuant to Clauses
6.1.7 and 6.2.2 and Schedule 9) as the Agent may in its
absolute discretion require; or
17.2.15 war if the country of registration of any Vessel becomes
involved in war (whether or not declared) or civil war or is
occupied by any other power and the Agent reasonably
considers that, as a result, the security conferred by the
Facility Documents is materially prejudiced; or
-66-
17.2.16 notice of termination if any Guarantor or any Shipowning
Guarantor gives notice to the Agent to terminate its
material obligations under the Guarantee or any of the
Shipowners' Guarantees, as appropriate; or
17.2.17 claim against Obligor's assets except for Permitted Liens,
if a maritime or other Encumbrance, distress or similar
charge is levied upon or against any Vessel, or upon or
against any substantial part of the assets of XXXX or other
Obligor or a Principal Subsidiary (on a consolidated basis)
and such is not discharged within 14 Business Days after any
Obligor or Principal Subsidiary (as the case may be) has
become aware of the same; or
17.2.18 Obligor's business if all or a substantial part of XXXX'x or
any Obligor's business is destroyed, abandoned, seized,
appropriated or forfeited for any reason; or
17.2.19 ownership if any of the Indemnifiers, the Senior Shipowning
Guarantors or the Guarantors other than XXXX ceases to be
100% directly or indirectly beneficially owned by XXXX or,
if any of the relevant Junior Shipowning Guarantors ceases
to be 100% directly or indirectly beneficially owned by
XXXX; or
17.2.20 final judgments if any of the Obligors fails to comply with
any non appealable court order or fails to pay a final
unappealable judgment against it, in either case, in excess
of $10,000,000 which remains unsettled for 14 days; or
17.2.21 third party charters if any Obligor fails to comply with
Clause 15.1.2; or
17.2.22 cross default if there occurs and is continuing any Event of
Default (as that expression is respectively defined in any
of the Existing Credit Agreements) under any of the Existing
Credit Agreements; or
17.2.23 executive management of XXXX if (i) any Executive Officer
ceases to serve as a member of the executive management of
XXXX (other than as a result of an extended illness or
bereavement) and he or she is not replaced by a person
satisfactory to an Instructing Group acting reasonably
within 45 days of so ceasing to serve, or (ii) the
engagement of the Chief Restructuring Officer is terminated
prior to the termination date specified in the engagement
letter dated 6 November 2003 between the Chief Restructuring
Officer and XXXX, (iii) the Chief Executive Officer has not
been elected to the board of directors of XXXX by the
shareholders of XXXX, or that his appointment to the board
of directors of XXXX has not been approved by the
shareholders of XXXX, on or before 31 May 2004 or (iv) the
Chief Executive Officer is removed from the board of
directors of XXXX and is not replaced within 45 days by a
person satisfactory to an Instructing Group acting
reasonably; or
17.2.24 invalidity if any Facility Document is not or ceases to be
in full force and effect or does not or ceases to constitute
the legal, valid, binding and enforceable obligations of the
Obligors; or
-67-
17.2.25 material adverse change if any material adverse change
occurs in any of the business, condition (financial or
otherwise), operations, performance, properties or prospects
of the SO Group (taken as a whole) in the reasonable opinion
of the Banks; or
17.2.26 auditor's qualification if the auditors of XXXX qualify
their annual audit report to the consolidated accounts of
XXXX in a manner which is, in the opinion of an Instructing
Group, material in the context of the Facility Documents and
the transactions contemplated in those documents; or
17.2.27 repudiation if any Obligor repudiates a Facility Document or
does or causes to be done any act or thing evidencing an
intention to repudiate a Facility Document; or
17.2.28 litigation if any litigation, arbitration, administrative,
governmental, regulatory or other investigations,
proceedings or disputes are commenced or overtly threatened
in relation to the Facility Documents or the transactions
contemplated in the Facility Documents or against any member
of the SO Group or its assets which is reasonably likely to
be determined against such member of the SO Group and if so
determined could, in the opinion of an Instructing Group,
reasonably be expected to have a Material Adverse Effect.
18 SET-OFF AND LIEN
18.1 Set-off Each of the Obligors' Agent, the Indemnifiers and the
Guarantors irrevocably authorises the Finance Parties at any time
after all or any part of the Obligations shall have become due and
payable to set off without notice any liability of the Obligors'
Agent, any Indemnifier or any Guarantor (as the case may be) to any of
the Finance Parties (whether present or future, actual or contingent,
and irrespective of the branch or office, currency or place of
payment) against any credit balance from time to time standing on any
account of the Obligors' Agent, such Indemnifier or such Guarantor (as
the case may be) (whether current or otherwise and whether or not
subject to notice) with any branch of any of the Finance Parties in or
towards satisfaction of the Obligations and, in the name of that
Finance Party, the Obligors' Agent, such Indemnifier or such Guarantor
(as the case may be), to do all acts (including converting or
exchanging any currency) and execute all documents which may be
required to effect such application.
18.2 Lien If an Event of Default has occurred and is continuing, each
Finance Party shall have an Encumbrance on and be entitled to retain
and realise as additional security for the repayment of the
Obligations any cheques, drafts, bills, notes or negotiable or
non-negotiable instruments and any stocks, shares or marketable or
other securities and property of any kind of the Obligors' Agent, the
Indemnifiers or the Guarantors (or of that Finance Party as agent or
nominee of the Obligors' Agent, such Indemnifier or such Guarantor)
from time to time held by that Finance Party, whether for safe custody
or otherwise.
18.3 Restrictions on withdrawal Despite any term to the contrary in
relation to any deposit or credit balance at any time on any account
of the Obligors' Agent, any Indemnifier or any Guarantor (as the case
may be) with any of the Finance Parties, no
-68-
such deposit or balance shall be repayable or capable of being
assigned, mortgaged, charged or otherwise disposed of or dealt with by
the Obligors' Agent, such Indemnifier or such Guarantor (as the case
may be) after an Event of Default has occurred and while such Event of
Default is continuing, but any Finance Party may from time to time
permit the withdrawal of all or any part of any such deposit or
balance without affecting the continued application of this Clause.
18.4 Application Whilst an Event of Default is continuing, each of the
Obligors' Agent, the Indemnifiers and the Guarantors irrevocably
authorises the Agent to apply all sums which the Agent may receive:
18.4.1 pursuant to a sale or other disposition of a Vessel or any
right, title or interest in a Vessel; or
18.4.2 by way of payment to the Agent of any sum in respect of the
Insurances, Earnings or Requisition Compensation of a
Vessel; or
18.4.3 otherwise pursuant to, arising under or in connection with
any of the Facility Documents,
in or towards satisfaction, or by way of retention on account, of the
Obligations, in such manner as the Agent may in its discretion
determine.
19 ASSIGNMENTS BY OBLIGORS
19.1 Assignments and transfers by the Obligors No Obligor shall be entitled
to assign or transfer all or any of its rights, benefits and
obligations hereunder, except with respect to the appointment of a
successor Obligors' Agent which is made in accordance with the
definition thereof in Clause 1.1.
20 ADDITIONAL INDEMNIFIERS
20.1 Additional Indemnifiers
20.1.1 An Indemnifier may request that any of XXXX'x trading
Subsidiaries becomes an Additional Indemnifier. That
Subsidiary shall become an Additional Indemnifier upon the
following conditions being satisfied:
(a) the Agent shall approve the addition of that Subsidiary
as an Additional Indemnifier;
(b) the Agent shall have received a duly completed and
executed Accession Agreement with respect to such
Subsidiary;
(c) no Default shall be continuing or would occur as a
result of that Subsidiary becoming an Additional
Indemnifier; and
(d) the Agent shall have received such documents and other
evidence listed in Clause 6.1 in relation to such
Additional Indemnifier as the Agent shall deem
appropriate, each in form and substance reasonably
satisfactory to the Agent.
-69-
20.1.2 The Agent shall notify the Indemnifiers and the Issuing
Banks promptly upon the provisions of Clause 20.1.1 having
been satisfied with respect to an Additional Indemnifier.
21 ASSIGNMENTS AND TRANSFERS BY FINANCE PARTIES AND SUB-PARTICIPATION
21.1 Right to assign Each of the Banks may with the prior written consent
of the Issuing Banks assign or transfer all or any of its rights under
or pursuant to the Facility Documents to any other branch of that Bank
or to any other bank or financial institution, and may grant
sub-participations in all or any part of its Commitment and Bank
Guarantee Outstandings provided that such assignment or transfer does
not result in an Indemnifier being subject to any additional Tax or
other financial or legal obligations other than those contemplated by
the terms of this Agreement at the time of such assignment or
transfer.
21.2 Indemnifier's co-operation Each of the Indemnifiers and the Guarantors
will co-operate fully with the Banks in connection with any
assignment, transfer or sub-participation pursuant to Clause 21.1,
will execute and procure the execution of such documents as the Banks
may require in connection therewith, and irrevocably authorises each
of the Finance Parties to disclose to any proposed assignee,
transferee or sub-participant (whether before or after any assignment,
transfer or sub-participation and whether or not any assignment,
transfer or sub-participation shall take place) all information
relating to the Obligors, the Facility or the Facility Documents which
each such Finance Party may in its discretion consider necessary or
desirable (subject to any duties of confidentiality applicable to the
Banks generally).
21.3 Rights of assignee Any assignee, transferee or sub-participant of a
Bank shall (unless limited by the express terms of the assignment,
transfer or sub-participation) take the full benefit of every
provision of the Facility Documents benefiting that Bank.
21.4 Transfer Certificates
21.4.1 If any Bank wishes to transfer all or any of its Commitment
and interest in the Bank Guarantee Outstandings as
contemplated in Clause 21.1 then such transfer shall be
effected upon the payment of a transfer fee equal to $2,000
and by the delivery to the Agent of a duly completed and
duly executed Transfer Certificate in which event, on the
later of the Transfer Date specified in such Transfer
Certificate and the fifth Business Day after the date of
delivery of such Transfer Certificate to the Agent:
(a) to the extent that in such Transfer Certificate the
Bank which is a party thereto seeks to transfer its
Commitment and the interest in Bank Guarantee
Outstandings in whole, the Obligors and such Bank shall
be discharged and released from further obligations
towards each other under this Agreement and their
respective rights against each other shall be cancelled
other than existing claims against such Bank for breach
of this Agreement (such rights, benefits and
obligations being referred to in this Clause 21.4 as
"discharged rights and obligations");
-70-
(b) the Obligors and the Transferee which is a party to
such Transfer Certificate shall assume obligations
towards one another and/or acquire rights against one
another which differ from such discharged rights and
obligations only insofar as the Obligors and such
Transferee have assumed and/or acquired the same in
place of the Obligors and such Bank; and
(c) the Agent, the Transferee and the other Banks shall
acquire the same rights and benefits and assume the
same obligations between themselves as they would have
acquired and assumed had such Transferee been an
original party to this Agreement as a Bank with the
rights, benefits and/or obligations acquired or assumed
by it as a result of such transfer.
21.4.2 Power of Attorney In order to give effect to each Transfer
Certificate the Finance Parties and the Obligors party
hereto each hereby irrevocably and unconditionally appoint
the Agent as its true and lawful attorney with full power to
execute on their respective behalves each Transfer
Certificate delivered to the Agent pursuant to Clause 21.4
without the Agent being under any obligation to take any
further instructions from or give any prior notice to, any
of the Finance Parties or, subject to the Indemnifiers'
rights under Clause 21.1, the Obligors before doing so and
the Agent shall so execute each such Transfer Certificate on
behalf of the other Finance Parties and the Obligors party
hereto immediately upon its receipt of the same pursuant to
Clause 21.4.
21.4.3 Notification The Agent shall promptly notify the other
Finance Parties, the Transferee and the Indemnifiers on the
execution by it of any Transfer Certificate together with
details of the amount transferred, the Transfer Date and the
parties to such transfer.
22 PAYMENTS, MANDATORY PREPAYMENT, RESERVE REQUIREMENTS AND ILLEGALITY
22.1 Payments All amounts payable by the Obligor' Agent, the Indemnifiers
and the Guarantors under or pursuant to any of the Facility Documents
shall be made payable to the Agent and paid to such accounts at such
banks as the Agent may from time to time direct to the Obligor' Agent,
any Indemnifier or any Guarantor (as the case may be), and (unless
payable in any other Currency of Account) shall be paid in Dollars in
same day funds (or such funds as are required by the authorities in
the United States of America for settlement of international payments
for immediate value). Payments shall be deemed to have been received
by the Agent on the date on which the Agent receives authenticated
advice of receipt, unless that advice is received by the Agent on a
day other than a Business Day or at a time of day (whether on a
Business Day or not) when the Agent in its reasonable discretion
considers that it is impossible or impracticable for the Agent to
utilise the amount received for value that same day, in which event
the payment in question shall be deemed to have been received by the
Agent on the Business Day next following the date of receipt of advice
by the Agent.
22.2 No deductions or withholdings All payments (whether of principal or
interest or otherwise) to be made by the Obligor' Agent, any
Indemnifier and/or any Guarantor
-71-
pursuant to the Facility Documents shall, subject only to Clause 22.3,
be made free and clear of and without deduction for or on account of
any Taxes or other deductions, withholdings, restrictions, conditions
or counterclaims of any nature unless required by law, and none of the
Obligors' Agent, the Indemnifiers, or the Guarantors will claim any
equity in respect of any payment due from it to the Banks, the Issuing
Banks, the Security Trustee or to the Agent under or in relation to
any of the Facility Documents.
22.3 Grossing-up If at any time any law requires (or is interpreted to
require) or the Obligor' Agent, any Indemnifier or any Guarantor to
make any deduction or withholding from any payment (or requires the
Agent to make any such deduction or withholding from any payment
received or receivable from the Obligor' Agent, any Indemnifier or
Guarantor), or to change the rate or manner in which any required
deduction or withholding is made, the Obligor' Agent, such Indemnifier
or such Guarantor (as the case may be) will promptly notify the Agent
and, simultaneously with making that payment, will pay to the Agent
whatever additional amount (after taking into account any additional
Taxes on, or deductions or withholdings from, or restrictions or
conditions on, that additional amount) is necessary to ensure that,
after making the deduction or withholding, each of the Agent, the
Security Trustee, the Issuing Banks and the Banks in all cases receive
a net sum equal to the sum which they would have received had no
deduction or withholding been made.
22.4 Evidence of deductions If at any time the Obligor' Agent, any
Indemnifier or any Guarantor is required by law to make any deduction
or withholding from any payment to be made by it pursuant to any of
the Facility Documents, the Obligor' Agent, such Indemnifier or such
Guarantor (as the case may be) will pay the amount required to be
deducted or withheld to the relevant authority within the time allowed
under the applicable law and will, no later than 30 days after making
that payment, deliver to the Agent an original receipt issued by the
relevant authority, or other evidence reasonably acceptable to the
Banks, evidencing the payment to that authority of all amounts
required to be deducted or withheld. If the Obligor' Agent, an
Indemnifier and/or Guarantor makes any deduction or withholding from
any payment under or pursuant to any of the Facility Documents, and a
Bank or Issuing Bank subsequently receives a credit, refund, relief,
remission or allowance from any tax authority which that Bank or
Issuing Bank identifies as being referable to that deduction or
withholding, that Bank or Issuing Bank shall, as soon as reasonably
practicable, interfering with the businesses operations of that Bank
or Issuing Bank, pay to the Obligor' Agent, such Indemnifier and/or
Guarantor an amount equal to the amount of the credit, refund, relief,
remission or allowance received, if and to the extent that it may do
so without prejudicing its right to benefit from that credit, refund,
relief, remission or allowance and without putting itself in any worse
financial position than that in which it would have been had the
deduction or withholding not been required to have been made. Nothing
in this Clause shall be interpreted as imposing any obligation on any
Bank or Issuing Bank unless requested by the Obligor' Agent, an
Indemnifier and/or Guarantor to apply for any credit, refund, relief,
remission or allowance nor as restricting in any way the manner in
which any Bank or Issuing Bank organises its tax affairs, nor as
imposing on any Bank or Issuing Bank any obligation to disclose to the
Obligor' Agent, the Indemnifiers and/or Guarantors any information
regarding its tax affairs or tax computations. All reasonable costs
and expenses incurred by any Bank or Issuing Bank in obtaining or
seeking to obtain a
-73-
credit, refund, relief, remission or allowance from any tax authority
pursuant to this Clause shall be for the relevant Obligor's account.
22.5 Adjustment of due dates If any payment to be made under any of the
Facility Documents, shall be due on a day which is not a Business Day,
that payment shall be made on the next succeeding Business Day (unless
the next succeeding Business Day falls in the next calendar month in
which event the payment shall be made on the next preceding Business
Day). Any such variation of time shall be taken into account in
computing any interest in respect of that payment.
22.6 Change in law If, by reason of the introduction of any law, or any
change in any law, or the interpretation or administration of any law,
or in compliance with any request or requirement from any central bank
or any fiscal, monetary or other authority:
22.6.1 any Finance Party (or the holding company of any Finance
Party) shall be subject to any Tax with respect to payments
of all or any part of the Obligations or the Banks'
Obligations; or
22.6.2 the basis of Taxation of payments to any Finance Party in
respect of all or any part of the Obligations shall be
changed; or
22.6.3 any reserve requirements shall be imposed, modified or
deemed applicable against assets held by or deposits in or
for the account of or loans by any branch of any Finance
Party or its direct or indirect holding company; or
22.6.4 any ratio (whether cash, capital adequacy, liquidity or
otherwise) which any Finance Party or its direct or indirect
holding company is required or requested to maintain shall
be affected; or
22.6.5 there is imposed on any Finance Party (or on the direct or
indirect holding company of any Finance Party) any other
condition in relation to the Obligations or the Facility
Documents),
and the result of any of the above shall be to increase the cost to
the Agent in undertaking or maintaining the Banks' Obligations, or to
cause any Finance Party to suffer (in its reasonable opinion) a
material reduction in its rate of return attributable to its
participation in the Facility and which it would have been able to
achieve but for its entering into this Agreement and/or performing its
obligations under this Agreement, the Finance Party affected shall
notify the Agent and, on demand to the Indemnifiers by the Agent, the
Indemnifiers shall from time to time pay to the Agent for the account
of the Agent the amount which shall compensate that Finance Party or
the Agent (or the relevant holding company) for such additional cost
or reduced return. A certificate signed by an authorised signatory of
the Agent or of the Finance Party affected setting out the amount of
that payment and the basis of its calculation shall be submitted to
the Indemnifiers and shall be conclusive evidence of such amount save
for manifest error or on any question of law.
This Clause 22.6 does not apply to the extent any increased cost is (i)
attributable to breach by the relevant Finance Party under the Facility
Document (ii) attributable to
-73-
fraud or the wilful breach by the relevant Finance Party of any law or
regulation or (iii) compensated for by Clause 22.3.
22.7 Illegality and impracticality Notwithstanding anything contained in
the Facility Documents, the obligations of any Issuing Bank to issue
any Bank Guarantee shall terminate in the event that a change in any
law or in the interpretation of any law by any authority charged with
its administration shall make it unlawful for any Bank to maintain its
Commitment. In such event the Issuing Bank affected shall notify the
Agent and the Agent shall, by written notice to the Indemnifier,
declare the Issuing Banks, and to the Banks' and/or the Agent's
obligations (as the case may be) to be immediately terminated.
22.8 Mitigation Each of the Finance Parties shall, in consultation with the
Agent, take all reasonable steps to mitigate any circumstances which
arise and result in any amount becoming payable under, or Commitment
being cancelled pursuant to this Clause 22, including by way of
transferring its rights and obligations under the Facility Documents
to an affiliate thereof, provided that nothing in this Clause 22.8
shall in any way limit the obligations of the Obligors under the
Facility Documents.
23 COMMUNICATIONS
23.1 Method Except for Communications pursuant to Clause 14, which shall be
made or given in accordance with Clause 14.21, any Communication may
be given, delivered, made or served (as the case may be) under or in
relation to this Agreement by letter or fax and shall be in the
English language and sent addressed:
23.1.1 in the case of any of the Finance Parties to the Agent at
its address at the head of this Agreement (fax no: + 44 20
(0) 0000 0000 marked for the attention of: Xxxxx X. Xxxxxxx;
and
23.1.2 in the case of the Obligor' Agent, each Indemnifier and/or
each Guarantor to the Communications Address;
or to such other address or fax number as the Finance Parties, any
Indemnifier or any Guarantor may designate for themselves by written
notice to the others.
23.2 Timing A Communication shall be deemed to have been duly given,
delivered, made or served to or on, and received by a party to this
Agreement except as otherwise expressly provided:
23.2.1 in the case of a fax when the sender receives one or more
transmission reports showing the whole of the Communication
to have been transmitted to the correct fax number;
23.2.2 if delivered to an officer of the relevant party or (in the
case of the Obligor' Agent, any Indemnifier and/or any
Guarantor) left at the Communications Address at the time of
delivery or leaving; or
23.2.3 if posted, at 9.00 a.m. on the third Business Day after
posting by prepaid first class post.
-74-
All Communications shall be in writing and unless otherwise stated be
by fax or letter. Any Communication by fax shall be promptly confirmed
in writing by post or hand delivery.
24 GENERAL INDEMNITIES
24.1 Currency In the event of any Finance Party receiving or recovering any
amount payable under any of the Facility Documents in a currency other
than the Currency of Account, and if the amount received or recovered
is insufficient when converted into the Currency of Account at the
date of receipt to satisfy in full the amount due, the Indemnifiers
and/or the Guarantors (as the case may be) shall, on the Agent's
written demand, pay to the Agent such deficit in the Currency of
Account as is sufficient to satisfy in full the amount due and that
deficit shall be due to the Agent on behalf of the Finance Parties as
a separate debt under this Agreement.
24.2 Costs and expenses Each of the Indemnifiers and the Guarantors will,
within 14 days of the Agent's written demand or as otherwise provided
in this Agreement, reimburse the Agent (on behalf of each of the
Finance Parties) for all reasonable out of pocket expenses including
all reasonable professional fees (including accountants', insurance
advisers, valuers' and legal fees) (including Value Added Tax or any
similar or replacement tax if applicable) of and incidental to:
24.2.1 the negotiation, syndication, preparation, execution and
registration of the Facility Documents (whether or not any
of the Facility Documents are actually executed or
registered and whether or not any Bank Guarantee is issued);
24.2.2 any amendments, addenda or supplements to any of the
Facility Documents (whether or not completed);
24.2.3 any other documents which are required to give effect to any
of the Facility Documents or which any Finance Party is
entitled to call for or obtain pursuant to any of the
Facility Documents (including, without limitation, all
premiums and other sums from time to time payable by the
Agent or the Security Trustee in relation to the Mortgagees'
Insurances); and
24.2.4 the exercise of the rights, powers, discretions and remedies
of the Finance Parties under or pursuant to the Facility
Documents.
24.3 Events of Default Each of the Indemnifiers and the Guarantors shall
indemnify the Finance Parties from time to time on demand against all
losses and costs incurred or sustained by any Finance Party as a
consequence of any Event of Default.
24.4 Protection and enforcement Each of the Indemnifiers and the Guarantors
shall indemnify the Finance Parties from time to time on demand
against all losses, costs and liabilities which any Finance Party may
from time to time sustain, incur or become liable for in or about the
protection, maintenance or enforcement of the rights conferred on the
Finance Parties by the Facility Documents or in or about the exercise
or purported exercise by the Finance Parties of any of the rights,
powers, discretions or remedies vested in them under or arising out of
the Facility Documents, including (without limitation) any losses,
costs and liabilities which any Finance Party may
-75-
from time to time sustain, incur or become liable for by reason of any
Finance Party being mortgagees of any Vessel and/or a registered owner
of shares as security holder under a Share Pledge and/or a lender or
guarantee provider to the Indemnifier, or by reason of any Finance
Party being deemed by any court or authority to be an operator or
controller, or in any way concerned in the operation or control, of
any Vessel. No such indemnity will be given to a Finance Party where
any such loss, cost or liability has occurred due to gross negligence
or wilful misconduct on the part of that Finance Party however this
shall not affect the right of any other Finance Party to receive any
such indemnity.
24.5 Reimbursement of Finance Parties Each of the Indemnifiers and the
Guarantors will from time to time reimburse the Finance Parties on
demand for all sums which any Finance Party may or is required to pay
on account of any of the Obligors or in connection with any Vessel
(whether alone or jointly or jointly and severally with any other
person) including (without limitation) all sums which any Finance
Party may or is required to pay or guarantees which any Finance Party
may or is required to give in respect of the Insurances, any expenses
incurred by any Finance Party in connection with the maintenance or
repair of any Vessel or in discharging any Encumbrance, bond or other
claim relating in any way to any Vessel, and any sums which any
Finance Party may or is required to pay or guarantees which they may
or are required to give to procure the release of any Vessel from
arrest or detention.
24.6 Taxes Each of the Indemnifiers and the Guarantors shall pay all Taxes
to which all or any part of the Obligations or any of the Facility
Documents may be at any time subject and shall indemnify the Finance
Parties on demand against all liabilities, costs, claims and expenses
resulting from any omission to pay or delay in paying any such Taxes.
The indemnity contained in this Clause shall survive the repayment of
the Obligations.
25 MISCELLANEOUS
25.1 Waivers No failure or delay on the part of any Finance Party in
exercising any right, power, discretion or remedy under or pursuant to
any of the Facility Documents, nor any actual or alleged course of
dealing between any Finance Party and any of the Obligors, shall
operate as a waiver of, or acquiescence in, any default on the part of
any Obligor, unless expressly agreed to do so in writing by the Agent,
nor shall any single or partial exercise by any Finance Party of any
right, power, discretion or remedy preclude any other or further
exercise of that right, power, discretion or remedy, or the exercise
by a Finance Party of any other right, power, discretion or remedy.
25.2 No oral variations No variation or amendment of any of the Facility
Documents shall be valid unless in writing and signed on behalf of the
Finance Parties by the Agent and the relevant Obligor or Obligors, as
the case may be.
25.3 Severability If at any time any provision of any of the Facility
Documents is invalid, illegal or unenforceable in any respect that
provision shall be severed from the remainder and the validity,
legality and enforceability of the remaining provisions shall not be
affected or impaired in any way.
-76-
25.4 Successors etc. The Facility Documents shall be binding on the
Obligors and shall enure to the benefit of the Finance Parties and
their respective successors, transferees and assignees. Neither any
Indemnifier nor any Guarantor may assign or transfer any of its rights
or duties under or pursuant to any of the Facility Documents without
the prior written consent of the Banks.
25.5 Further assurance If any provision of the Facility Documents shall be
invalid or unenforceable in whole or in part by reason of any present
or future law or any decision of any court, or if the documents at any
time held by the Finance Parties on their behalf are considered by the
Banks for any reason insufficient to carry out the terms of this
Agreement, then from time to time the Indemnifiers and/or the
Guarantors (as the case may be) will promptly, on demand by the Agent,
execute or procure the execution of such further documents as in the
reasonable opinion of the Banks are necessary to provide adequate
security for the repayment of the Obligations.
25.6 Other arrangements The Finance Parties may, without prejudice to their
rights under or pursuant to the Facility Documents, at any time and
from time to time, on such terms and conditions as they may in their
discretion determine, and without notice to any Obligor, grant time or
other indulgence to, or compound with, any other person liable
(actually or contingently) to the Finance Parties or any of them in
respect of all or any part of the Obligations, and may release or
renew negotiable instruments and take and release securities and hold
funds on realisation or suspense account without affecting the
liabilities of any Obligor (as the case may be) or the rights of the
Finance Parties under or pursuant to the Facility Documents.
25.7 Advisers The Indemnifiers and the Guarantors irrevocably authorise the
Agent, at any time and from time to time during the Facility Period,
to consult insurance advisers on any matters relating to the
Insurances, including, without limitation, the collection of insurance
claims, and from time to time to consult or retain advisers or
consultants to monitor or advise on any other claims relating to the
Vessels. The Indemnifiers and the Guarantors will provide such
advisers and consultants with all information and documents which they
may from time to time reasonably require and will reimburse the Agent
on demand for all reasonable costs and expenses incurred by the Agent
in connection with the consultation or retention of such advisers or
consultants.
25.8 Delegation The Finance Parties may at any time and from time to time
delegate to any person any of their rights, powers, discretions and
remedies pursuant to the Facility Documents, other than rights
relating to actions to be taken by an Instructing Group or the Banks
as a group on such terms as they may consider appropriate (including
the power to sub-delegate).
25.9 Rights etc. cumulative Every right, power, discretion and remedy
conferred on the Finance Parties under or pursuant to the Facility
Documents shall be cumulative and in addition to every other right,
power, discretion or remedy to which they may at any time be entitled
by law or in equity. The Finance Parties may exercise each of their
rights, powers, discretions and remedies as often and in such order as
they deem appropriate subject to obtaining the prior written consent
of an Instructing Group. The exercise or the beginning of the exercise
of any right, power, discretion or
-77-
remedy shall not be interpreted as a waiver of the right to exercise
any other right, power, discretion or remedy either simultaneously or
subsequently.
25.10 No enquiry The Finance Parties shall not be concerned to enquire into
the powers of the Obligors or of any person purporting to act on
behalf of any of the Obligors, even if any of the Obligors or any such
person shall have acted in excess of their powers or if their actions
shall have been irregular, defective or informal, whether or not any
Finance Parties had notice thereof.
25.11 Continuing security The security constituted by the relevant Facility
Documents shall be continuing and shall not be satisfied by any
intermediate payment or satisfaction until the Obligations shall have
been repaid in full and none of the Finance Parties shall be under any
further actual or contingent liability to any third party in relation
to the Vessels, the Insurances, Earnings or Requisition Compensation
or any other matter referred to in the Facility Documents.
25.12 Security cumulative The security constituted by the relevant Facility
Documents shall be in addition to any other security now or in the
future held by the Finance Parties or any of them for or in respect of
all or any part of the Obligations, and shall not merge with or
prejudice or be prejudiced by any such security or any other
contractual or legal rights of any of the Finance Parties, nor
affected by any irregularity, defect or informality, or by any
discharge, release, exchange or variation of any such security.
Section 93 of the Law of Property Xxx 0000 and all provisions which
the Agent considers analogous thereto under the law of any other
relevant jurisdiction shall not apply to the security constituted by
the relevant Facility Documents.
25.13 No release or discharge In the event that any amount paid to any
Finance Party in respect of the Obligations is avoided on insolvency,
liquidation or otherwise then to the extent such payment is avoided,
the liability of the Obligors in respect of such Obligations and the
liability for such obligation and security interests granted under the
Facility Documents shall continue as if such payment had not occurred
and the release and discharge provided herein (or in any Facility
Document) or according to this Agreement (or any Facility Document)
had not occurred.
25.14 No liability None of the Finance Parties, nor any agent or employee
of any Finance Party, nor any receiver and/or manager appointed by the
Agent or the Security Trustee, shall be liable for any losses or any
special, indirect, consequential or punitive damages which may be
incurred under or in connection with the Facility Documents or the
transactions contemplated thereunder, nor liable as mortgagee or
security holder in possession for any loss on realisation or for any
neglect or default of any nature for which a mortgagee or security
holder in possession might otherwise be liable unless such Finance
Party's action constitutes gross negligence or wilful misconduct. Each
of the Obligors' Agent, the Indemnifiers and the Guarantors waives,
discharges, releases and agrees (for itself and on behalf of its
Subsidiaries) not to xxx on any such claim for any such losses or
damages whether or not accrued and whether or not known or expected to
exist in its favour, except in the event that such party alleges gross
negligence or wilful misconduct.
25.15 Rescission of payments etc. Any discharge, release or reassignment by
any of the Finance Parties of any of the security constituted by, or
any of the obligations of any
-78-
Obligor contained in, any of the relevant Facility Documents shall be
(and be deemed always to have been) void if any act (including,
without limitation, any payment) as a result of which such discharge,
release or reassignment was given or made is subsequently wholly or
partially rescinded or avoided by operation of any law, unless such
Finance Party's action constitutes gross negligence or wilful
misconduct.
25.16 Subsequent Encumbrances If the Agent or the Security Trustee receives
notice of any subsequent Encumbrance (other than any Permitted Liens)
affecting any Vessel, or all or any part of the Insurances, Earnings
or Requisition Compensation, the Agent may open a new account in its
books for the Indemnifiers. If the Agent does not open a new account,
then (unless the Encumbrance is permitted by the terms of this
Agreement or the Agent gives written notice to the contrary to the
Indemnifiers) as from the time of receipt by the Agent of notice of
such subsequent Encumbrance, all payments made to the Agent shall be
treated as having been credited to a new account of the Indemnifiers
and not as having been applied in reduction of the Obligations.
25.17 Releases If any Finance Party shall at any time in its discretion
discharge or release any party from all or any part of any of the
Facility Documents or from any term, covenant, clause, condition or
obligation contained in any of the Facility Documents, the liability
of any other party to the Facility Documents shall not be varied or
diminished.
25.18 Certificates Any certificate or statement signed by an authorised
signatory of the Agent purporting to show the amount of the
Obligations (or any part of the Obligations) or any other amount
referred to in any of the Facility Documents shall, save for manifest
error or on any question of law, be conclusive evidence as against the
relevant Obligor of that amount.
25.19 The Banks' Obligations Neither the Agent, nor the Security Trustee
nor any agent or employee of the Agent or the Security Trustee shall
be liable to the Obligors for any loss or damage arising from any
action taken or omitted in relation to the Banks' Obligations, unless
caused by its or their gross negligence or wilful misconduct. In
particular, but without limitation, neither the Agent nor any agent or
employee of the Agent shall be liable for any loss or damage arising
from any delay, loss, error, omission, variation or mutilation in the
transmission, translation, coding or decoding of all or any part of
the Banks' Obligations or any communication in connection with the
Banks' Obligations.
25.20 Survival of representations and warranties The representations and
warranties on the part of each of the Indemnifiers and the Guarantors
contained in this Agreement shall survive the execution of this
Agreement and the advance of the Facility or any part thereof.
25.21 Counterparts This Agreement may be executed in any number of
counterparts each of which shall be original but which shall together
constitute the same.
25.22 Third Party Rights Other than the provisions of Clause 25.14 which
the parties hereto acknowledge shall extend to the employees, agents,
receivers and managers of the Finance Parties and may be relied upon
by such employees, agents, receivers and managers no term of this
Agreement shall be enforceable pursuant to the Contracts (Rights of
Third Parties) Xxx 0000 by a person who is not a party to this
Agreement.
-79-
For the avoidance of doubt however it shall not be necessary for the
parties to this Agreement to obtain the consent of the employees,
agents, receivers and managers of the Finance Parties in order to
amend, supplement or modify the terms of this Agreement.
25.23 Loan account Each Bank and each Issuing Bank shall maintain, in
accordance with its usual practice, an account evidencing the amounts
from time to time owing to it, actually or contingently, under the
Facility Documents. The control account shall, in the absence of
manifest error, be conclusive as to the amount from time to time owing
by the Indemnifiers, the Guarantors and the Shipowning Guarantors
under this Agreement and the other Facility Documents.
26 LAW AND JURISDICTION
26.1 Governing law This Agreement shall in all respects be governed by and
interpreted in accordance with English law.
26.2 Jurisdiction For the exclusive benefit of the Finance Parties, the
parties to this Agreement irrevocably agree that the courts of England
are to have jurisdiction to settle any disputes which may arise out of
or in connection with this Agreement and that any Proceedings may be
brought in those courts. Each of the Obligors' Agent, the Indemnifiers
and the Guarantors irrevocably waives any objection which it may now
or in the future have to the laying of the venue of any Proceedings in
any court referred to in this Clause, and any claim that those
Proceedings have been brought in an inconvenient or inappropriate
forum.
26.3 Alternative jurisdictions Nothing contained in this Clause shall limit
the right of the Finance Parties to commence any Proceedings against
any Indemnifier or any Guarantor in any other court of competent
jurisdiction nor shall the commencement of any Proceedings against the
Obligors' Agent, any Indemnifier or any Guarantor in one or more
jurisdictions preclude the commencement of any Proceedings in any
other jurisdiction, whether concurrently or not.
26.4 Service of process Without prejudice to the right of the Finance
Parties to use any other method of service permitted by law, each of
the Obligors' Agent, the Indemnifiers and the Guarantors irrevocably
agrees that any claim form, writ, notice, judgment or other legal
process shall be sufficiently served on it if addressed to it and left
at or sent by post to the Address for Service, and in that event shall
be conclusively deemed to have been served at the time of leaving or,
if posted, at 9.00 a.m. on the third Business Day after posting by
prepaid first class registered post.
IN WITNESS of which the parties to this Agreement have executed this Agreement
the day and year first before written.
SIGNATORIES
SIGNED by )
duly authorised for and on behalf ) XXX XXXXXXXX
of HSBC BANK PLC ) (SENIOR MANAGER)
(as a Bank) )
in the presence of: )
SIGNED by ) XXXXXXX XXXXXXX
duly authorised for and on behalf ) (HEAD OF ADVISORY SERVICES)
of CREDIT LYONNAIS )
(as a Bank) ) XXXXXX XXXXXX
in the presence of: ) (VICE PRESIDENT)
SIGNED by )
duly authorised for and on behalf ) XXXXXX XXXXX
of DNB NOR BANK ASA ) (FIRST VICE PRESIDENT)
(formerly DEN NORSKE BANK )
ASA ) XXXXXX X. XXXXX, III
(as a Bank) ) (SENIOR VICE PRESIDENT
in the presence of: Xxxxxxxx Xxxxxxx) AND GENERAL COUNSEL)
SIGNED by )
duly authorised for and on behalf ) XXXXXXX XXXXXX
of ING CAPITAL LLC ) (MANAGING DIRECTOR)
(as a Bank) )
in the presence of: )
SIGNED by )
duly authorised for and on behalf ) XXXXXX XXXXXXXXX
of VEREINS-UND ) (VICE PRESIDENT)
WESTBANK AG )
(as a Bank) ) XXXXXX XXXXXXXX
in the presence of: ) (SENIOR VICE PRESIDENT)
SIGNED by )
duly authorised for and on behalf ) XXXX XXXXX
of NORDEA BANK FINLAND ) (VICE PRESIDENT)
PLC, NEW YORK BRANCH )
(as a Bank) ) HANS CHR. KJELSRUD
in the presence of: ) (SENIOR VICE PRESIDENT)
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXX
of SCOTIABANK EUROPE PLC ) (DIRECTOR,
(as a Bank) ) SPECIAL ACCOUNT MANAGEMENT)
in the presence of: )
SIGNED by )
duly authorised for and on behalf ) XXXXXX XXXXXXX
of NATEXIS BANQUES ) (DEPUTY HEAD, CORPORATE BANKING)
POPULAIRES )
(as a Bank) ) XXXXXX XXXXXX-XXXXX
in the presence of: ) (DEPUTY HEAD,
UTILITIES, ENERGY & CONSTRUCTION)
SIGNED by )
duly authorised for and on behalf ) XXXXX X. XXXXXXX
of HSBC BANK PLC ) (MANAGER)
(as the Agent) )
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXX XXXXXXXX
of HSBC BANK PLC ) (SENIOR MANAGER)
(as the Arranger) )
in the presence of: )
SIGNED by )
duly authorised for and on behalf ) XXX XXXXXXXX
of HSBC BANK PLC ) (SENIOR MANAGER)
(as the Issuing Bank) )
in the presence of: )
SIGNED by ) XXXXXXX XXXXXXX
duly authorised for and on behalf ) (HEAD OF ADVISORY SERVICES)
of CREDIT LYONNAIS )
(as the Issuing Bank) ) XXXXXX XXXXXX
in the presence of: ) (VICE PRESIDENT)
SIGNED by )
duly authorised for and on behalf ) XXXXXX XXXXX
of DNB NOR BANK ASA ) (FIRST VICE PRESIDENT)
(formerly DEN NORSKE BANK )
ASA ) XXXXXX X. XXXXX, III
(as a Bank) ) (SENIOR VICE PRESIDENT
in the presence of: Xxxxxxxx Xxxxxxx) AND GENERAL COUNSEL)
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of XXXXX OFFSHORE S.A. ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of XXXXX OFFSHORE ) (GENERAL COUNSEL)
SERVICES S.A. )
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of XXXXX OFFSHORE A.S. ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of XXXXX OFFSHORE ) (GENERAL COUNSEL)
LIMITED )
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of XXXXX OFFSHORE INC. ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of XXXXX OFFSHORE S.A. ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of SCS HOLDINGS N.V. ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of XXXXX OFFSHORE B.V. ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of XXXXXXXXXXX A.S. ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of SCS HOLDINGS LIMITED ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of XXXXX COMEX SEAWAY ) (GENERAL COUNSEL)
HOLDINGS INC. )
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of ETPM DEEPSEA LIMITED ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of SEAWAY (UK) LIMITED ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of SOTRAPLEX S.A. ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of XXXXX OFFSHORE WEST ) (GENERAL COUNSEL)
AFRICA S.A.S.U. )
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of ETPM (UK) LIMITED ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of ETPM INTERNATIONAL ) (GENERAL COUNSEL)
(UK) LIMITED )
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of ETPM LOGISTICS B.V. ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
SIGNED by )
duly authorised for and on behalf ) XXXXX XXXXXXXXX
of SO MARINE INC. ) (GENERAL COUNSEL)
in the presence of: Xxxx Xxxxxx )
